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EXPORTING AUTOMOBILES TO RUSSIA
by Yuri Malkov

Importing automobiles and other vehicles into Russia is expensive
but often essential for U.S. companies doing business there. 
Since heavy customs duties were imposed last July, combined
import tariffs and excise taxes can exceed 100 percent of a
vehicle's total value.  Accredited foreign companies and foreign
nationals resident in Russia, however, are exempt in many cases. 
Taking advantage of these exemptions is not easy.  Import
requirements are complex and confusing.  Relevant customs
regulations are often difficult to access, and enforcement often
depends more on the mood of individual officials than on the law.

Commercial Use--But No Resale
Western companies, banks, and other organizations accredited in
the Russian Federation are exempt from all import taxes on
vehicles brought into the country for their own use.  Such
vehicles are considered "temporary" imports and may not be
resold.  Customs officials determine the period of temporary
import based on the duration of accreditation.  Temporary imports
are authorized under customs order #1276, dated November 10,
1994. 

Unaccredited foreign companies are also eligible for full or
partial import tax relief, under customs order #328 of April 25,
1994.  This order exempts vehicles from all import taxes as long
they remain in Russia less than one year and are not resold. 
Exemptions apply to: 

Vehicles used for international transportation of passengers and 
cargo, and associated spare parts and equipment. 
          
Products for exhibition at trade shows, trade fairs, and other
events.           Product samples imported only for
display to customers  (should not number more than two vehicles
of the 
same type).           

Products imported for testing or experimentation.  

Products imported for competitions, sport shows, and training.    
 

Temporarily imported vehicles other than those specified above,
or whose temporary use has been extended beyond one year, enjoy
partial import tax relief.  In such cases, a customs charge of
three percent of the total cost of the vehicle is assessed each
month.  "Total cost" for this purpose is the original product
price plus all import taxes.  Advanced assessment of up to three
months may be required.  If the vehicle is re-exported, these
fees are not returned.  If it is sold, the monthly fees already
paid by the time of sale are included in the import taxes
assessed.  Vehicles imported into Russia as a contribution to
authorized capital of enterprises with foreign investment are
exempt from the value added tax for one year beginning from the
moment of enterprise registration.

Personal Vehicles

Individuals moving to Russia permanently from other countries are
exempt from import duties for one vehicle, except new vehicles
with engine size over 1,800 cubic centimeters.  Residents of
foreign countries are exempt from import duties for temporary
import of one vehicle for a period not to exceed one year, for
personal use or use by the members of the importer's family. 
Permanent residents of the Russian Federation who stay abroad for
over six months without interruption are also eligible to import
one vehicle without paying import taxes, except new vehicles with
engine size over 1,800 cubic centimeters. 

Individuals should provide customs officials with a customs
declaration that includes the retail cost of the vehicle.  The
prospective importer should also be prepared to authenticate the
retail cost.  Otherwise customs officials will assess the cost
themselves based on price information maintained by Russian
Customs.  The importer can dispute this decision and apply for
another evaluation, but this can be a troublesome and
time-consuming endeavor.  For more detailed information on
importing motor vehicles into the Russian Federation call
Flashfax at (202) 482-3145, and order document #6596.
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