Bigger Tax on Expensive Cars

Russia will not introduce a luxury tax, at least in a traditional way. Instead, those running expensive cars will have to pay more.

Deputy Finance Minister Sergei Shatalov has said that the government decided to increase the tax on vehicles with engine capacity over 410 horsepower. He has even named the brands which will fall under the new rule: Maybach, Bentley, Lamborghini, Ferrari, Maserati, Porsche, Aston Martin, Rolls-Royce, Chevrolet Corvette and 6-liter Mercedes and 7-Series BMW. This is about 20,000 cars, mainly in Moscow and Moscow region.

The engine capacity has been picked to 'almost completely eliminate the increased taxation of cars manufactured in Russia’.

The law will also introduce higher tax on expensive property: real estate worth up to 100 million roubles ($3 million) will be taxed at the rate of 0.05%, between 100 and 300 million roubles ($10 million) – 0.1%, and over 300 million roubles – 0.3%.

The tax will be introduced in 2013.