News Room - Business/Economics

Posted on 22 Sep 2023

Russian government considers export duties on most goods

The Russian Ministry of Finance and the Ministry of Economy are contemplating implementing export duties on nearly all types of goods from 1 October, lasting until the end of 2024, according to Kommersant. A source from a steel mill confirmed to Kallanish these discussions are taking place.

The ad valorem rate will be linked to the rouble exchange rate versus the dollar, with rates ranging from 4% to 7%. When the exchange rate ranges between RUB 80-85 roubles, the duty will stand at 4%; for RUB 85-90, it is 4.5%; for RUB 90-95, it is 5.5%; and for rates exceeding RUB 95, it reaches 7%. Linking the export duty to the exchange rate is aimed to compensate for some of the negative effects due to lower costs in dollar terms amid a weak rouble.

Key exceptions will include oil, petroleum products, gas, timber, scrap, grain, and specific mechanical engineering products under HS chapters 84-96.

The industries most impacted by these potential duties will be metallurgy, coal, and fertiliser producers, significantly affecting Russia's non-oil and gas raw material exports, according to media reports. Some experts anticipate that the introduction of these duties could erode up to a third of export margins, and may have a negative impact on companies' investment programmes.

Source:Kallanish