RUSSIA. A report from leading Russian news agency Prime-Tass said this week that Russia’s Federal Customs Service wants to reduce the duty free allowance on imported goods.
It said that Customs “considers it necessary” to reduce the personal allowance to RUB15,000 (US$538 at today’s exchange rates) from the present RUB65,000 (US$2,330). Its source was Yury Azarov, Deputy Director of the service, who made the statement during a session of the Economic Policy Committee of Russia’s State Duma, the lower house of the Russian parliament.
Azarov claimed that the high personal allowance had created an “unregistered trade carried out by individuals” with Southeast Asian countries, Turkey and other countries of US$6 billion a year, which was detrimental to Russian producers.
Russian international travellers have become one of the most important buying groups for many international retailers. In categories such as luxury goods and consumer technology, in particular, they often number among the top spenders in travel retail locations from Asia to the Middle East to Europe.
For example, a cross-referenced analysis of category purchases by different nationalities conducted by King Power Duty Free in Thailand last year and published by The Moodie Report showed Russians to have the second highest purchase level per transaction across all categories with an average spend of US$67.74, behind the Thais (US$76.44) but ahead of the South Koreans (US$65.65), the Chinese (US$54.80) and the Japanese (US$49.92).
In fragrances they spent US$85.42, again only behind the Thais (US$93.29). In cosmetics the Russians again came second behind the Thais in the spend per transaction league with an average US$74.76, ahead of all the keen cosmetics-buying Asian nations.
But watches is the category where the big-spending Russians come into their own. In the King Power survey they spent an average US$496.85 per transaction, well ahead of their nearest rival (the Japanese, with US$390.42).
Personal duty free allowances are regularly the subject of political debate, so Azarov’s comments do not necessarily indicate that a change in allowances will happen. But developments will clearly be watched by many travel retailers around the world.
MORE STORIES ON DUTY FREE IN RUSSIA
Global Refund in Russian travel shopping initiative – 08/06/04
Russian store GUM sold to luxury goods specialist – 13/02/04
