Russia Adjusts Law On Car Recycling Tax

by Tatiana Smolenska, Tax-News.com, Moscow

13 January 2014

Russia has changed the law on its vehicle recycling fee following complaints made to the World Trade Organization (WTO) by the European Union (EU) and others.

The amendment, which was enacted on January 01, 2014, requires domestic automakers to pay the same recycling fee as foreign manufacturers, as requested by Japan in WTO dispute settlement consultations.

The recycling fee, introduced on September 01, 2012, is levied on imported cars, trucks, buses and other motor vehicles at rates ranging from EUR420 (USD571) to EUR147,700. Although the fee also applies to domestic manufacturers, exemption was granted to vehicles from Russia's Customs Union partners Kazakhstan and Belarus, as well as domestic manufacturers which agreed to handle waste safely.

The fee was disputed by the EU, Japan and the United States on the grounds that it appeared to conflict with Article III of the General Agreement on Tariffs and Trade 1994 by giving preferential treatment to Russian and Customs Union car makers.

The amendment removes the exemptions for vehicles produced in Russia, Kazakhstan and Belarus.

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