Russia to increase foreign aircraft import duties
Russia's Ministry of Industry and Trade is ready to increase import duties for foreign planes that directly compete with indigenous SSJ-100 and MC-21 aircraft, Kommersant reports. For the time being, aircraft seating 50-300 passengers can be imported with zero duty tax. Meanwhile, Russian airlines continue to expand their fleets with foreign aircraft, increasing the number of such by 16% year-over-year. The Ministry's ambition comes as a surprise to both airlines and leasing companies, knowing that the SSJ-100 has a low production rate, and the MC-21 is still in its testing phase.
At the end of 2019, Russia plans to cancel discounted rates of duties applied to the temporary import of foreign aircraft that compete with SSJ-100 and МС-21, Russia's news agency Interfax reported quoting the Ministry of Industry and Trade. The decision would affect airliners weighing 20-90 tons and seating 50-300 passengers.
Since 2010, a zero duty rate is applied, as was decided by the Eurasian Customs Union. The new rules would affect the most common models – Airbus 319/320/321 (262 units currently flying in Russia) and the various Boeing 737 modifications (172 units), as well as Embraer E-170 and E-175, and Bombardier C Series.
Deputy Prime Minister Dmitry Rogozin spoke about the plans to cancel the benefits on August 6, in an interview with Rossiya 1 TV channel. In his opinion, air transportation is now "addicted to the foreign aircraft industry", and airlines pay around 470 billion rubles ($7.8 billion) to foreign manufacturers. According to Rogozin, such a situation is "an insult to the nation."
However, during the interview, the deputy prime minister admitted that the Russian aviation industry produces "30 aircraft a year", which is 25 times less than Airbus or Boeing. The official believes that Russian aircraft manufacturers will produce 110 aircraft annually by 2025. According to him, the import benefits for foreign aircraft, will be abolished after Russian planes enter the market, which is slated for 2019.