Russian Industry and Trade Ministry readying proposals on exemption from 'exchange rate' duties for new industries, decision not to be quick

MOSCOW. Jan 18 (Interfax) - Discussions on the exemption of a number of categories of export goods from the duty tied to the dollar exchange rate, introduced in September 2023, continues, but the decision will not be quick, Vasily Osmakov, first deputy head of the Russian Industry and Trade Ministry, told Interfax.

"The discussion continues. It must be understood that the budget is put together as a whole . In general, as I said, we need strong arguments regarding each code [TN VED], each of the sectors," he said on the sidelines of Machine Building Day at the Russia International Exhibition and Forum.

"It is clear that with the sectors that are associated with large revenue shortfalls, everything is more complicated. This will come later, we are working in this direction," the official said.

Earlier it was reported that fertilizer producers requested exclusion from the list of goods subject to the "exchange rate" duty. The Industry and Trade Ministry also said earlier that it might be advisable to exempt pulp and paper products from the duty.

Osmakov recalled that at the end of last year the government had already exempted a number of goods from the "exchange rate" export duties, including medicines and pharmaceutical substances, certain chemical products, household metal products, tools for drilling, pressing and other operations, zephyr and marshmallow products, soy protein concentrate, beet pulp, certain types of coal products. At the same time, in order to support SMEs, so-called low-value goods, the total customs value of which does not exceed 200 euros, were exempt from the duties.

According to the first deputy minister, it took the government two and a half months to agree on this decision. Therefore, with the approval of the new list of exceptions, "In purely technical terms it will be impossible to do it prior to February."

"These are serious decisions that cost billions of dollars," Osmakov emphasized.

The export duty on a wide range of goods tied to the ruble exchange rate was introduced by the government on October 1, 2023 and will be in effect until the end of 2024. The duty rate at the exchange rate of 80-85 rubles/$ is 4%, at 85-90 rubles/$ - 4.5%, at 90-95 rubles/$ - 5.5%, at 95 rubles/$ and more - 7%.