Crimea transitions to Russian VAT

Sun 27th Apr 2014

Following the Russian annexation of the Crimean region of Ukraine on 18 March 2014, a decree has been issued to start the process of transitioning to the Russian VAT regime.

Phased implementation of Russian VAT

Crimea will switch to the Russian tax code from the start of 2015. However, the following changes will be implemented from 1 May 2014 by a State Council decree:

  • Foodstuffs will switch from the Ukrainian VAT rate of 20% to the Russian 18% or reduced rate off 10% for the basics
  • Sales to Ukraine proper now become ‘exports and are VAT free from (back dated to 26 March 2014)
  • Purchases from Ukraine proper now become imports, and are therefore subject to 18% VAT
  • There is no longer a facility to deduct Ukrainian input VAT suffered.


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