Russia's NPCS to lower transaction service rates Jan 1 due to introduction of VAT

MOSCOW. Dec 19 (Interfax) - Russia's National Payment Card System (NPCS), the operator of the Mir card, plans to lower rates for transaction services and the services of the Mir payment system as of January 1, 2026 in light of the fact that they will lose their value-added tax exemption next year, the NPCS told Interfax.

President Vladimir Putin signed a law at the end of November that cancels the VAT exemption that has been in effect since 2006 for transactions and services related to servicing bank cards, as well as the services of companies that handle the transfer and processing of data between settlement participants (processing and acquiring).

It is expected that, among other things, rates will be lowered on clearing and authorization, which account for most of the expenses of Mir payment system participants.

"Some of the rates on which the VAT began to be charged for the first time were adjusted taking into account this tax. This refers to the services and optional services that account for no more than an estimated 3% of the expenses of Mir payment system participants. For example, payment for provision of the BIN, 3DS authentication and detokenization," the NPCS said.

Payments for services that were already subject to the VAT, such as payment for trademark, will remain unchanged.

The NPCS will also not change payments for services that it provides as the operating and clearing center of the Express Payment System.

The Russian authorities created the NPCS in 2014 after Russia was hit by a number of sanctions. The NPCS, which is wholly owned by the Central Bank of Russia, announced the issue of the first Mir cards in December 2015.