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VAT on the transit of empty cars and containers offered to reset

16 July 2019
Logistics News

International transit is not only the delivery of goods, but also the transport of empty containers and wagons. The message with China is characterized by a strong irregularity of transportation, when the share of return of empty containers and wagons is high. The already high cost of transporting empty containers and wagons makes taxation at a VAT rate of 20% even higher. Note that for international transit of goods and related freight forwarding services, there is a 0% VAT rate.

At the same time, foreign shippers cannot count on deducting the amount of VAT, and this reduces the attractiveness of Russia as a transit country. Only preferential taxation for the transport of empty containers and wagons can support the business and increase the competitiveness of Russian transit corridors. Namely, the introduction of a zero rate of VAT. Which, by the way, operates in the same Belarus and Kazakhstan, which, like Russia, are members of the Eurasian Economic Union.

Yesterday, July 15, a draft federal law “On Amendments to Articles 164 and 165 of Part Two of the Tax Code of the Russian Federation” was submitted to the State Duma, designed to extend the zero rate of VAT on transit of empty containers and cars.

One of the authors of the bill, a member of the Committee on Control and Regulations, Alexey Kobilev, noted that entrepreneurs have long been waiting for the introduction of a fair zero rate on international transit shipments of empty containers and wagons. As a result of such taxation, according to the deputy, the volume of transit traffic will increase and the transit potential of Russia as a whole will increase.