Import VAT: who pays it and who gets it back

When it is paid, and to whom

Import VAT does not behave like the VAT a company settles with the tax office at the end of a period. It is paid to the customs authority, and it is paid before the goods are released — release is conditional on the money having cleared. Until it has, the consignment stays in a temporary storage warehouse, where storage is charged by the day.

The party who pays is the declarant: the legal entity in whose name the declaration is filed. If your company is the importer of record, that is you. If an intermediary brings the goods in and sells them to you inside Russia, the import VAT is theirs to pay, and what reaches you is an ordinary domestic supply with Russian VAT on the invoice.

One term needs unpacking for a reader used to the EU. Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan form the Eurasian Economic Union — a single customs territory with one external frontier. “The border” throughout this article means that frontier: the port or land crossing where the goods arrive on the Union’s territory. Not the gate of your warehouse, and not the internal line between two member states, which the goods cross without a further declaration.

What the tax is charged on

This is where the arithmetic parts company with expectations. VAT is not charged on the price of the goods. It is charged on a figure built in three layers, and the first of them already exceeds the supplier’s invoice.

1. The customs valueThe price actually paid or payable for the goods, plus the cost of moving them as far as the Union’s customs border: carriage, insurance, loading and handling on that stretch. So an ex-works or FOB invoice is not the starting figure: carriage and insurance to the border are added on top of it. On terms that already include the freight, the two figures converge before a single tax has been applied.
2. Plus the import dutyThe rate follows the commodity code — the Union’s ten-digit classification, built on the Harmonised System, so the first six digits will look familiar to anyone who has filed a declaration in the EU. Two goods that look alike to a buyer can sit under codes whose rates differ several times over.
3. Plus excise, where it appliesOnly for excisable goods. That list is closed and set by law rather than assembled case by case, so if your goods are not on it this line does not appear in the calculation at all.

Budgeting a shipment as “the price of the goods plus 22 per cent” understates it in two places at once: the base already contains the freight to the border, and the duty is added before the tax is worked out. The figure is calculated from the commodity code, and it wants doing before the supply contract is signed rather than after the container has sailed.

The rate

From 1 January 2026 the standard rate of Russian value added tax is 22 per cent, raised from the 20 per cent that applied before. Reduced rates apply to certain categories of goods, and part of what crosses the border is exempt from the tax altogether.

Which rate attaches to your goods follows from the same commodity code that sets the duty. That is the second reason to establish the code before the deal rather than after arrival: one classification decision moves two numbers.

The categories carrying a reduced rate are deliberately not listed here. Those lists are amended, and a list printed in an article goes out of date without announcing it. The rate for a specific consignment is read off the list in force for its code, not assumed from the standard figure.

The deduction, and why everything turns on it

Two Russian tax regimes decide the answer here, and which one a company is on decides whether import VAT is an expense or a float. This is the piece a reader from outside Russia has no way to infer, and it is the piece the whole comparison rests on.

The general regime is the default: full accounting, profit tax, and VAT charged on the company’s own sales with the tax the company has itself been charged set against it. Import VAT paid at the border goes into that second half. Economically it is not a cost but working capital tied up between the border and the return, and an importer arriving from the EU will recognise the shape of it — there too import VAT is input tax that a VAT-registered business recovers.

The simplified regime is the alternative, and the name is literal: lighter reporting and a single tax on turnover or on income less expenses, aimed at smaller companies. The trade-off is that the regime carries no right to deduct input tax at all: the import VAT has nothing to be set against, whatever the company charges on its own sales. It stays inside the cost of the goods, and it has to be carried into the selling price.

This is also where the standard argument for grey shipping comes apart. Set “cargo is a third cheaper” against a declared shipment and two corrections have to go in: subtract the VAT a general-regime company deducts, then allow for the fact that a documented cost of goods reduces taxable profit. After both, the gap narrows. Where shipments repeat and the deduction recurs with every declaration, it can turn the other way.

• What the deduction rests onThe goods declaration bearing the customs authority’s release mark, evidence that the tax was paid, and the goods entered in your accounts. The goods themselves have to be used in activity that is subject to VAT.
• What that document isThe declaration filed for the consignment, stamped by customs when the goods are released. Russian accountants still call it by an abbreviation left over from an earlier regime, GTD. It is the single piece of paper the deduction hangs on, and it exists only where the import was declared.
• When it is claimedIn the quarter in which every condition has been met. The right to claim runs for a period fixed by law; where that leaves your own accounts is a question for your accountant, against your actual position.
• Who cannot claim itA company on the simplified regime. For it the import VAT is part of the cost of the goods — a number to build into the price rather than one to recover.

Why a grey shipping has no such line

A shipment that arrived through a grey shipping has no goods declaration, because none was filed. With no declaration there is no basis for a deduction: there is nothing to reclaim, because on paper nothing was paid.

The chain runs on from there. Goods without documents cannot be put on the balance sheet cleanly. Their cost is hard to defend as a deduction against taxable profit. You have nothing to show a marketplace or a retail chain that asks where the goods came from, and nothing to hold against the factory when the wrong thing arrives, because your company was never a party to the purchase. The saving that looked like a third of the price turns out to be what you paid for giving all of that up.

This is arithmetic rather than a moral position. A one-off parcel for a company’s own use can genuinely come out cheaper the other way. The argument here is about a business that imports repeatedly, sells the goods on and files tax returns on the result.

What this article does not do

It explains a mechanism; it does not stand in for an accountant, and it is not tax advice. How the tax is recorded, the quarter in which the deduction is claimed, what happens when goods are returned or arrive faulty, how any of it works through an intermediary, and what changes when a company moves between tax regimes — these are questions where a mistake costs money and the answer depends on the specific position of the specific company.

What we work out ourselves, before the deal rather than after it: the landed cost of your goods. The commodity code, the duty rate, the VAT, the customs fees and the clearance. That is a figure you can take a decision on.