Russia cuts VAT on domestic passenger airline travel

Russia reduced the VAT rate on domestic passenger travel to the reduced VAT rate of 10% from 1 July 2015. The cut in Value Added Tax rate is designed to help the flagging industry cope with falling demand (liked to the recent recession) and rising fuel prices. The latter comes from the long-term withdrawal of fuel prices subsidies which have been much greater than the drop in global oil prices.

The current standard Russian VAT rate is 18%.