Russia considers lowering VAT to 10% on domestic cars, motorcycles, and electronics

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A group of lawmakers from the Communist Party of the Russian Federation (CPRF), led by First Deputy Chairman Yuri Afonin, has proposed reducing the value-added tax (VAT) rate for certain Russian-made goods.

The draft law suggests setting a VAT rate of 10% for Russian-produced cars, motorcycles, electronics, and household appliances. Currently, the standard VAT rate is 22%.

The authors of the initiative propose amending Article 164 of the Russian Tax Code accordingly.

"We propose to reduce the VAT rate to 10% for electronics, household appliances, cars, and motorcycles manufactured in Russia. This will, on the one hand, create additional incentives for opening and developing production within the country and creating new jobs, and on the other hand, make domestic goods more affordable for citizens," Afonin said.

The parliamentarian noted that the prices of durable goods—such as cars, motorcycles, and household appliances—continue to rise, making these products less accessible to consumers. According to him, VAT is one of the components of the final price.

The CPRF believes that lowering the tax rate will reduce costs for Russian manufacturers and create additional conditions for expanding existing enterprises and launching new ones.

In addition, the authors of the bill expect the creation of new jobs and an increase in the supply of domestic goods in the domestic market.

The initiative aims to simultaneously stimulate production development in Russia and reduce product prices for Russian consumers through tax incentives.