Estonian railway operator EVR Cargo intends to set up a subsidiary in Russia to be able to rent out railcars at more favorable terms on the Russian market.
“For EVR Cargo it becomes necessary to establish a subsidiary in Russia if it wishes to rent out railcars in Russia, in order to avoid double taxation,” EVR Cargo manager Raul Toomsalu said.
If the cars are rented out directly by a company registered in Estonia, a tax of 10-20% would be levied depending on whether or not the cars operate also outside Russia.
Using the cars for operation within Russia alone would mean a tax rate of 20%. In addition to that comes the topic of customs, as railcars registered in Estonia can be used in Russian territory only if a temporary import duty of 5 euros per railcar per day is paid on them, which would make it pointless to rent the cars to Russia at the intended price of 13 euros a day.