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Russia expecting scrappage fee shortfall as car market struggles
Published by Global Banking & Finance Review®
Posted on May 6, 2025
2 min readLast updated: January 24, 2026
Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on May 6, 2025
2 min readLast updated: January 24, 2026
Russia faces a shortfall in car scrappage fees due to declining sales, affecting budgeted projects. Chinese automakers dominate the market.
MOSCOW (Reuters) - Russia expects its revenues from car scrappage fees to fall well short of budgeted levels this year, Finance Minister Anton Siluanov told reporters on Tuesday, which could lead some projects being abandoned.
With Chinese automakers now dominating Russia's car market, Moscow had planned to effectively raise taxes on imported cars this year by doubling scrappage fees for all producers while increasing state support for domestically made vehicles.
Domestic manufacturers and car importers alike are required to pay a scrappage fee in Russia to cover the future costs the state incurs for managing the scrapping process.
Russia had planned to almost double its revenues from car recycling in 2025 to 2.01 trillion roubles ($24.77 billion) from 1.08 trillion roubles, but those expectations have been dashed in part by declining car sales.
"This year, our scrappage receipts are differing noticeably from what was in the budget," Siluanov told reporters, without specifying the size of the drop.
Projects set to be implemented using funds from scrappage fees could be cut if the necessary revenues do not materialise, he added.
According to data from Russia's industry and trade ministry, sales of new cars in January-April were down 27% year on year to 404,016 units.
($1 = 81.1455 roubles)
(Reporting by Darya Korsunskaya and Gleb Bryanski; additional reporting by Gleb Stolyarov; Writing by Alexander Marrow; Editing by Jan Harvey)
Russia had planned to almost double its revenues from car recycling in 2025 to 2.01 trillion roubles, but those expectations have been dashed.
Finance Minister Anton Siluanov indicated that scrappage receipts are differing noticeably from what was budgeted, although he did not specify the size of the drop.
Projects set to be implemented using funds from scrappage fees could be cut if the necessary revenues do not materialize.
Sales of new cars in Russia from January to April were down 27% year on year, totaling 404,016 units.
Moscow had planned to effectively raise taxes on imported cars by doubling scrappage fees for all producers while increasing state support for domestic manufacturers.
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