Customs Procedures for the Import of Goods into Russia
By Dezan Shira & Associates
The demand for foreign products into Russia has been significantly increasing over the past 12 months as Russia both recovers its economy from the drop in global oil prices and sanctions, and is moving into positive GDP growth rates. Pent up demand and a large consumer class are making the country an attractive proposition to sell to.
Russia is also a member of the Eurasian Economic Union, which allows goods imported into any of the member countries (Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia) to be freely transported throughout these nations. In this article, we explain the import and customs duties procedures.
The customs declaration can be made by an assigned manager of a Russian registered company, including foreign companies established under Russian law. This is presented to the local customs office in the city – where the company is registered. A company exporting to Russia can also call in a customs broker who will take charge of carrying out customs formalities in its name. Clearance inward, with immediate payment of duties and taxes, is the regime most commonly used by operators exporting to Russia.
All importation must present a freight declaration. This declaration shall be accompanied by the following documents:
- Commercial invoices and packing list;
- Transport documents;
- Import licenses (if applicable);
- Certificates of conformity;
- Certificates of origin (if applicable); and
- Sanitary certificates (if applicable).
Imported goods are customs cleared at the customs border. After that, goods are free to circulate in Russia and the Eurasian Economic Union without additional customs controls.
In the case of temporary entry, goods can be fully or partially exempt from customs duties and import VAT for a period of up to two years. Professional advise is required as concerns which goods, and for applying for refunds, among other things.
Specific import procedures
There is a license system for certain specific products (pesticides, jewelry and precious materials, electrical material, etc.), which represent about 3 percent of all the goods imported. These licenses are issued by the Ministry of Foreign Economic Relations, and controlled by the State Customs Committee.
Commercial samples are exempt from customs duties and import VAT for a period of up to two years, if they are used only for promotional proposes. Biological samples and samples of medicines must be accompanied by specific certificates.
Customs duties and taxes on imports
The customs threshold (from which tariffs are required) include imports with a cost, insurance, and freight (CIF) value of under RUB 5,000, and may enter without duty or tax.
Average customs duty (excluding agricultural products)
Since its official entry into the WTO on 22 August 2012, Russia has committed to implement all the provisions of the WTO, including an average tariff of 7.8 percent for goods.
Products having a higher customs tariff
Finished products (15 percent), foodstuffs (20 percent), and agricultural products.
The rates displayed in the customs tariff are applied to countries which benefit from the Most Favored Nation clause (MFN), and include a majority of third world countries, as well as those of the European Union. However, due to the sanctions imposed by the EU, certain products may be illegible. Please contact a professional for advise as concerns products impacted by sanctions from the EU.
Russia has a free trade agreement with CIS countries and Serbia. In addition, a common economic area with Belarus and Kazakhstan within the framework of the Eurasian Economic Union is in force, and may result in lower or zero tariffs. Seek professional advise for clarification.
Russia implements the Harmonized Customs System (HS codes). The customs tariff includes 11,032 tariff lines.
Calculation of duties
85 percent of tariff lines are taxed on an ad valorem basis. Russian regulations provide for methods of determining customs value, generally the CIF standard in conformity with the rules of the WTO.
The rest uses a combined system: the tariff applied is the maximum between the ad valorem tariff and a specific tariff, often fixed.
Method of payment of customs duties
Duties and taxes are collected by the State Customs Committee. Customs also collects fees for carrying out customs formalities. Payment is made in cash when making the customs declaration. Clearing customs is only authorized with a certificate proving payment has been made.
For assistance with importing goods into Russia, please contact Dezan Shira & Associates at firstname.lastname@example.org. We maintain operations with Partners in Moscow, St.Petersburg and Vladivostok and can assist foreign businesses import their products into Russia and the EAEU.
Dezan Shira & Associates´ Russian investment brochure offers an overview of the services provided by the firm – both foreign investment into Russia and Russian investment into Asia. It is Dezan Shira´s mission to guide investors through Russia´s complex regulatory environment and assist with all aspects of establishing, maintaining and growing business operations in the region.
In this issue of Russia Briefing, we explain the basics of business set up for foreign investors, from trademark registration, representation, trading mechanisms, and manufacturing. With low corporate tax rates, Russia is set to become the most dynamic of the trade corridors opening up to Asia.