Russia’s Ministry of Industry and Trade has supported the introduction of a 22% value-added tax (VAT) on foreign goods purchased online.
The tax is expected to take effect on January 1, 2027. Previously, the Ministry of Finance had proposed a more lenient scenario – a gradual increase starting with a 7% rate in 2027.
The introduction of VAT on cross-border trade had been postponed for several years due to concerns about destabilizing consumer demand, notes Alexei Ivanov, owner of the Alliance Trucks commercial vehicle dealership chain. Russian sellers pay all taxes in full, cover the costs of labeling, certification, and compliance with Rospotrebnadzor requirements, yet still have to compete with Chinese sellers operating under an almost tax-free regime.
According to Data Insight, cross-border online orders delivered to Russia in 2025 exceeded 209 million parcels worth 404 billion rubles. Ninety percent of this volume originated from China. As the expert notes, the government could no longer ignore such an imbalance.
“The disagreement between the Ministry of Industry and Trade and the Ministry of Finance regarding the pace of tax implementation is essentially a business matter. The Ministry of Industry and Trade supports an immediate increase to 22%, while the Ministry of Finance favors a gradual rise from 7% to 22% over a three-year period. From the standpoint of market stability, the latter’s approach appears more reasonable as a sudden increase in the burden on consumers could undermine a segment the state aims to legalize rather than eliminate. The final compromise reflected in the Ministry of Finance’s draft legislation therefore appears balanced,” the entrepreneur believes.
According to Alexei Ivanov, the changes will undoubtedly benefit the domestic market. Russian manufacturers of consumer goods, footwear, textiles, and cosmetics will finally gain the competitive space they have long lacked. Certain Chinese sellers are expected to leave the market or revise their pricing strategies. Marketplaces, meanwhile, are likely to adapt, as they have both the infrastructure and sufficient time before 2027.
“A significant share of components for European and Japanese vehicles currently enters Russia through cross-border channels, either directly from Chinese platforms or through intermediaries. The introduction of VAT will also affect this segment: spare parts will become more expensive, and small resellers operating on minimal margins may begin exiting the market. In the medium term, this is going to accelerate consolidation, allowing only those companies with direct supplier contracts and the ability to operate legally to remain competitive. For Russian manufacturers of similar products, this could provide an additional incentive to expand production. The key issue is ensuring that administration of the new tax remains simple and predictable. If registering foreign sellers with the Federal Tax Service turns into a bureaucratic obstacle course, much of the intended effect could be lost before implementation even begins,” Alexei Ivanov warns.