Russia to Trial Tax-Free Shopping System for Foreigners in January 2017

Russia will begin the gradual implementation of a tax free system, enabling foreigners to recover tax on purchases, starting on January 1, 2017, local media reported Tuesday.

MOSCOW (Sputnik) — The system that will allow foreign tourists to claim back the 18 percent value-added tax (VAT) on non-food goods purchased in Russia will be implemented in two steps: from January 1, 2017 — in a limited number of stores and from July 1, 2017 — the project would be launched on full scale, the Rossiyskaya Gazeta newspaper reported.

Russia's First Deputy Prime Minister Igor Shuvalov entrusted the Ministry of Finance with preparing a road map for the project by the end of the year. As for now, three cities are being considered for the first phase of the implementation: Moscow, St. Petersburg and Kazan.

The measure is expected to attract more tourists who should be able to apply for refunds on the tax paid on purchases of goods above 10,000 rubles ($150), thus encouraging trade development and investment.