Used car purchases in Estonia from Russia are significantly up having almost quadrupled year-on-year.
Private cars increasingly bought from Russia
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In the first seven months of 2015, inhabitants of Estonia bought 29 used cars from Russia. This year, the figure already stands at 106. For reference: overall car purchases from abroad for the same periods stood at 895 and 1,058, respectively.
For the most part, used cars from Russia are bought by private citizens, predominantly those dwelling in Narva. Shunning Russia’s own brands, they mostly purchase cars like Mercedes, BMW, Volkswagen, Volvo and Škoda.
According to Ants Kutti at Tax and Customs Board (MTA), a reason is the low exchange rate for the rouble. Often, MTA sends cars from Russia for extra inspection to assess if the car declared corresponds to the market price and to keep the state from being cheated with taxes.
«We assess if the price is according to the condition of the car. If the car has been in an accident, it is logical for it to cost less. But is the remarkably low price is explained by a broken headlight, we will not let that pass,» said Mr Kutti.
The background of the cars is thoroughly checked as well, to see if it is not stolen or of other criminal background. Thus far, such violations with cars from Russia have not been detected.
Buying a car from Russia, one needs to pay 10 percent custom tax from its price, and 20 percent of VAT. The taxes are to be paid during five days; as a rule, the vehicles indeed get registered within that time limit and may then be driven in Estonia.
A look at Russia’s car sales portals shows us that in St Petersburg a 2011 Volkswagen Passat would cost an average of 580,000 roubles i.e. €7,900. Add the costs of getting the car into Estonia plus the local Estonian taxes, it will cost €10,500. In Estonian Internet portals, all ads regarding Volkswagen Passats of that year are above €11,000.