ACIT offers to block websites of foreign stores that do not pay VAT in Russia

Published on November 23, 2016

ACIT offers to block websites of foreign stores that do not pay VAT in Russia



    The Association of Internet Trading Companies (ACIT) has developed a draft law that provides for blocking cross-border retailers if the latter do not pay VAT in Russia. By blocking is meant restricting access to the site by entering into the register of prohibited sites of Roskomnadzor. The proposal of the ACIT reports RBC, at the disposal of which there is a draft law. The bill is already being discussed in the State Duma.

    At the moment, Russians are relatively free to receive goods from foreign online stores. When importing parcels from abroad, there is a duty-free limit: for one calendar month, goods for personal use can be imported to one recipient for a total value of no more than 1,000 euros and weighing up to 31 kg.

    Russians are writing out goods from abroad more and more. ACIT claims that last year the share of cross-border trade accounted for 29%, and this year the share will rise to 35%. The growth rate of sales from abroad - 45%, this year its volume will reach $ 300 billion. According to AKIT, the number of shipments from abroad increased by 102% over the year .

    At the same time, the Russian treasury does not receive taxes from these purchases - a foreign online store makes the necessary contributions to the state budget of its jurisdiction, double taxation does not occur. This problem should be solved by the bill of AKIT, an organization whose members are Russian stores and large retail chains: Eldorado, M.Video, Detsky Mir, KupiVIP and about 30 other online retailers. According to the head of the Electronic Commerce Cluster of the Russian Association of Electronic Communications, Ivan Kurguzov, foreign retailers exist in Russia “in greenhouse conditions” and the situation needs to be aligned with the realities of Russian stores.

    AKIT offered to force foreign stores to pay VAT in the summer. So the association wants to ensure equal rules of the game. The budget committee of the State Duma in this proposal see an opportunity to eliminate losses. According to the chairman of the committee, Andrei Makarov, this year, the treasury will miss $ 45 billion due to cross-border trade, $ 64 billion in 2017, almost $ 300 billion in three years. Last Friday, November 18, Makarov confirmed at the plenary session State Duma that the proposal AKIT blocking sites is discussed. Prior to this, the issue of taxation of foreign online stores appeared in the list of Putin’s orders to the government on November 5.

    ACIT in its bill wants to oblige foreign online stores to pay VAT on purchases of Russians in the amount of 15.25%. This is slightly less than the basic rate of VAT in Russia at the moment - 18%. Upon reaching the limit for parcels and paying customs duties, the ACIT bill provides for the possibility of refund of VAT paid by the online store.

    The measure applies not only to individual stores, but also sites of the level of Amazon, eBay or AliExpress. On such market places organized the sale of goods by individuals or organizations. Under the terms of the bill, the sites are assigned the status of a “tax agent” and the need to monitor the payment of VAT to the Russian budget. If any participant does not pay VAT, then the platform should block the seller from trading.

    Otherwise, the marketplace will be asked to pay tax for the participant: a penalty of 100% unpaid VAT is provided. If the fine is not paid, the whole site will be blocked. In ACIT, the measures are considered soft: for the failure to pay taxes in Russia, a criminal term is threatened.

    Access to sites in Russia is limited by providers of communication services on the “black lists” of Roskomnadzor. They are not made by the RKN itself - entries in the register of blocked sites appear by the decisions of the courts, the Rospotrebnadzor (in cases of information about suicides), the Federal Drug Control Service (drugs), and so on. The ACIT bill provides that the Federal Tax Service (FTS) will initiate locks in the case of non-payment of VAT. Tax authorities are offered to issue the authority to request information about operations from payment organizations: the National Payment Card System, money transfer operators, bank payment agents, clearing centers. Also, the FTS want to be allowed to request information from telecom operators, Russian Post, transport and courier services.

    It is not known whether global sellers will take into account the requirements of the tax authorities from Russia. For many of them, the Russian direction is secondary. As stated by the President of the National Association of Distance Trade (NADT), Alexander Ivanov, the share of Russia in the total turnover of Internet commerce is about a percent, and for the sake of this market the platforms will not change. According to Ivanov, the bill aims to ensure the absence of competition for Russian players.

    NADT includes 17 companies: eBay store, Hermes and DPD delivery services, A1 logistics companies, Pony Express and others. November 18 NADT warnedin a letter to Deputy Prime Minister Arkady Dvorkovich about the negative consequences: in the case of the implementation of ACIT measures, foreign companies will lose interest and leave the market. Similar things happened in Brazil, where eBay and Alibaba left, the letter’s authors remind. To administer the tax, funds are also needed that will exceed the funds raised, according to NADT.

    Instead of VAT, NADT offered to collect a small sales tax for foreign online retailers. Such low barriers for foreign companies operate in Japan (8%) or Australia (10%). The letter was sent to the address: Dvorkovich repeatedly spoke out for replacing VAT with a sales tax. NADT also offers another measure: the reduction of the duty-free import threshold from € 1000 per month to € 200 per package. In AKIT, they prefer the scheme with VAT and with the proposals of NADT do not agree.

    The approximate term of the appearance of the law Dvorkovich gave on October 8: the mechanism of introduction - before the end of the year, in the spring of 2017 - the submission to the State Duma of the bill for consideration.

    At the moment, online stores are already appearing in the “Unified Register of Banned Sites”, but so far they are Russian. Sites are blocked for protection against counterfeit, fake items. Recently, the court of Avtozavodsky district of Nizhny Novgorod considered the miniature models of GAZ cars as counterfeit and ordered Roskomnadzor to block the car site. Today, the FTS is already engaged in blocking websites: at the request of the tax authorities , access to thousands of online casino sites is blocked .