Will the WTO help to reduce prices for cars

The entry of the Russian Federation to the World Trade Organization (WTO) led to a decrease in customs duties and establishing new rules for playing in the domestic car market. How will this affect the price tag in car dealers and autobahlas of the country.

The Russian Federation for two more decades sought to get into the World Trade Organization. It happened in 2012 after complex and difficult negotiations. It is noteworthy that the automotive sector and aviation turned out to be the two topics for which federal officials leading negotiations on our part, they launched special conditions. Because if these industries fall under the Liberal WTO Rules, the country can lose these two important sectors of the economy.

Recall that for the domestic auto industry, the negotiators had a special transitional period, for several years, count from 2012 to 2019, during which the so-called «industrial» regime was preserved and increased customs duties on imported cars. But everything is once ends, and this transition period also approached the end.

The Russian Federation for the last time will last reduce import customs duties for imported cars within the framework of agreements with the WTO from September 1, 2019.

Now import duties are 17% on new passenger cars, and on used — 22%. However, a few days later, or rather from September 1, this year. They will constitute, as told in the Ministry of Economic Development of the Russian Federation, for new cars — 15%, and on cars with mileage — 17%. However, there will also be a minimum rate reduction at the rate of 1 cc. Motor volume. On average, such a bid will decrease by 0.05 euros per 1 cc. Motor volume for new cars and 0.06 euros per 1 cc. Motor volumes for used cars.

This reduction will affect only passenger cars. For trucks, similar reduction in duties were held until 2018. And now for cargo equipment, duties are installed in size 0-15%.

Recall that the purpose of creating a WTO is to eliminate the «excess» customs barriers between countries. This should contribute to the formation of competitive industries and displacing ineffective. But in practice in many countries, due to the removal of customs barriers «digest» whole industries, the population is deprived of jobs, and imports replaces local production. As a result of the «poor» countries become poorer, and the most developed countries and their local transnational companies remain in winning. Therefore, far-sighted policies and economists come up with a number of protection measures from the WTO Rules. In particular, China before joining the WTO had 100% duty on the import of foreign cars. And for his transitional period, it was able to create the world’s largest auto industry and the world’s largest car market.

But back to the Russian car market. We had duties were more gentle. In 2012, in Russia for the first time, barrier customs barriers introduced as the protection of national automakers during the crisis in 2009 were seriously lowered: from 30% to 25% — on new cars under seven years and from 35% to 25% — for used . Also duties decreased in 2017 and 2018.

At that time (2012), the share of imports in sales of cars was 48%, now this indicator does not exceed 15%.

Thus, the Russian Federation still managed to create a local car industry with a total capacity of 3.56 million cars per year. (Given the commissioning of the Tula enterprise «Having Motor Manufechchuring Rus» and «Mercedes-Benz», total capacity approached the 3.7 million mark). But the main danger is for him — the shaft of a used foreign car.

The decline in customs duties is not so significant that the auto business was revived on the import of used cars. No one canceled excise, utilization collection, so it will not affect the car market. So consider experts.

Early, importers will lose a little from reducing rates, but it is not necessary to expect a decline in prices for this percentage, in Russia, the prices never decrease.

However, the previous decline in customs duties led to some increase in car imports. In the past 2018, about 300 thousand foreign cars were imported (new and used), which is 9.5% higher than in 2017. Apparently, this growth was the factors of the recovery of the car market last year, when, in general, sales of new cars increased by 12.8%.

In the Ministry of Industry, responsible for the automotive sector of the economy, do not expect a stream of used cars after a decrease in customs rates can significantly reduce the likelihood of buying a new machine, which as a result will hit the auto industry.

Despite the reduction of duties, customs barriers remain quite serious, in addition to the customs collection, legal entities in the import of the car pay excise and VAT. Since 2012, legal entities and individuals (regardless of the age and mileage of the car) during the import of cars are obliged to pay the utilization collection, substantially indexed in 2017. Recall that the recycling fee for new cars with an engine over 1000 cubic meters. see, but no more than 2,000 cc. CM increased twice (from 44.2 thousand rubles to 84 thousand rubles), on automobiles of engine over 2000 ccm, but not more than 3000 ccm — by 50% ( from 84 thousand rubles to 126 thousand rubles), on cars with a complete mass of over 2.5 tons, but not more than 3.5 tons — by 51% (from 198 thousand rubles to 300 thousand rubles).

Meanwhile, the decline in customs duties on passenger cars with internal combustion engines will not affect electric vehicles. Despite the inclusion of this type of transport to priority areas for implementation in the automotive industry, the government does not intend to support the import of electric vehicles, although it is ready to deviate the serial electric vehicle of domestic production (there are no such). As noted in the Ministry of Industry, the duty on electric cars is currently and is so at a minimum level — 15%.