TARIFF

Tariff, also called customs duty, tax levied upon goods as they cross national boundaries, usually
by the government of the importing country. The words tariff, duty, and customs can be used
interchangeably ("Tariff | international trade", 2019).

TARIFF SYSTEM OF RUSSIA

Since Russia’s official entry into the World Trade Organization (WTO) on August 2012,
it has committed to implement all the provisions of the WTO, including an average tariff of 7.8
percent for goods. According to Shira, the demand for foreign products into Russia has been
significantly increasing over the past 12 months as Russia both recovers its economy from the
drop in global oil prices and sanctions, and is moving into positive GDP growth rates. Russia is
also a member of the Eurasian Economic Union, which allows goods imported into any of the
member countries (Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia) to be freely
transported throughout these nations (Shira, 2019).
Customs declaration can be made by an assigned manager of a Russian registered
company, including foreign companies established under Russian law. It is presented to local
customs office in the city where the company is registered. A company exporting to Russia can
also call in a customs broker who will take charge of carrying out customs formalities in its
name. Clearance inward, with immediate payment of duties and taxes, is the regime most
commonly used by operators exporting to Russia.
Imported goods are customs cleared at the customs border. After that, goods are free to
circulate in Russia and the Eurasian Economic Union without additional customs controls. In the
case of temporary entry, goods can be fully or partially exempt from customs duties and import
VAT for a period of up to two years. There is a license system for certain specific products
(pesticides, jewelry and precious materials, electrical material, etc.), which represent about 3
percent of all the goods imported. These licenses are issued by the Ministry of Foreign Economic
Relations, and controlled by the State Customs Committee. Commercial samples are exempt
from customs duties and import VAT for a period of up to two years, if they are used only for
promotional proposes. Biological samples and samples of medicines must be accompanied by
specific certificates.
The customs threshold (from which tariffs are required) include imports with a cost,
insurance, and freight (CIF) value of under RUB 5,000, and may enter without duty or tax.
Finished products (15 percent), foodstuffs (20 percent), and agricultural products. The rates
displayed in the customs tariff are applied to countries which benefit from the Most Favored
Nation clause (MFN), and include a majority of third world countries, as well as those of the
European Union. As there are sanctions imposed by the EU, certain products may be illegible. 85
percent of tariff lines are taxed on an ad valorem basis. Russian regulations provide for methods
of determining customs value, generally the CIF standard in conformity with the rules of the
WTO.
Duties and taxes are collected by the State Customs Committee. Customs also collects
fees for carrying out customs formalities. Payment is made in cash when making the customs
declaration. Clearing customs is only authorized with a certificate proving payment has been
made (Shira, 2019).
TARIFF SYSTEM OF INDIA
The World Trade Organization estimates that India’s applied most favored nation import
tariffs are 13.8 percent and highest of any major economy. The structure of India’s customs tariff
and fees system is complex and characterized by a lack of transparency in determining net
effective rates of customs tariffs, excise duties, and other duties and charges.   India’s customs
rates are modified on an ad hoc and arbitrary basis through notifications in the Gazette of India
and contain numerous exemptions that vary according to the product, user, or specific export
promotion program, rendering India’s customs system complex to administer and open to
administrative discretion.
India’s tariff regime is also characterized by pronounced disparities between WTO bound
rates and the most favored nation (MFN) applied rates charged at the border.  According to the
latest WTO data, India’s average bound tariff rate is 48.5 percent, while its simple MFN average
applied tariff is 13.8 percent (per the WTO latest 2017 data available).  India’s average WTO-
bound tariff for agricultural products is 113.5 percent.  Applied rates are also relatively high and
on a trade-weighted basis, the average agricultural tariff is 32.8 percent.
India has not systematically reduced the basic customs duty in the past six years.
India maintains high tariffs on a number of goods, and operates a number of complicated duty
drawback, duty exemption, and duty remission schemes for imports. In addition, India maintains
high basic customs duties, in some cases exceeding 20 percent, on drug formulations, including
life-saving drugs and finished medicines listed on the World Health Organization’s list of
essential medicines. Many of India’s bound tariff rates on agricultural products are among the
highest in the world, ranging from 100 percent to 300 percent. The large gap between bound and
applied tariff rates in the agriculture sector allows India to use tariff policy to make frequent
adjustments to the level of protection provided to domestic producers, creating uncertainty for
importers and exporters. India further raised duties on several information and communications
technology products, including cell phones, from 15 percent to 20 percent.
Government of India’s, Central Board of Indirect Taxes and Customs (CBIC or the
Board) functioning under the Department of Revenue, Ministry of Finance, deals with the
formulation of policy concerning levy and collection of Customs.  The classification of the
imports and exports of the goods are governed by the Customs Act of 1962 and Customs Tariff
act of 1975.  The act contains two schedules, and specifies the nomenclature that is based on the
Harmonized Commodity Description and Coding System as “HS” and also contains description
of goods chargeable to export duty. 
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Russia’s economic freedom score is 58.9, making its economy the 98th freest in the 2019
Index. Its overall score has increased by 0.7 point, with higher scores for monetary freedom and
property rights outpacing declines in judicial effectiveness and trade freedom. Russia’s weak
property rights impede economic progress and deter foreign investment. The combined value of
exports and imports is equal to 46.7 percent of GDP. The average applied tariff rate is 3.6
percent. As of June 30, 2018, according to the WTO, Russia had 225 nontariff measures in force.
Foreign investment is screened, and investment in several sectors of the economy is capped. As
for India’s economic freedom score which is 55.2, making its economy the 129th freest in the
2019 Index.  India is then expected to shift from efforts to improve the business climate. The
combined value of exports and imports is equal to 40.6 percent of GDP. The average applied
tariff rate is 6.3 percent. As of June 30, 2018, according to the WTO, India had 369 nontariff
measures in force. Foreign investment is screened, but ownership restrictions in some economic
sectors have been reduced. The government has recapitalized state-owned banks, and the number
of their nonperforming loans is increasing ("Country Rankings: World & Global Economy
Rankings on Economic Freedom", 2019). India’s high imposing tariff rates have never done the
country any good, at this point, Russia can be concluded as the country that have paved its way
to the open market way better and crucially thought of than India.

References:
India - Import TariffsIndia - Import Tariffs. (n.d.). Retrieved 7 November 2019, from
https://www.privacyshield.gov./article?id.=India-Import-Tariffs.
Russia - Import TariffsRussia – Import Tariffs. (n.d.). Retrieved 7 November 2019, from
https://www.export.gov./article?id.=Russia-Import-Tariffs.
Tariff | international trade. (2019). Retrieved 7 November 2019, from
https://www.britannica.com/topic/tariff
Shira, D. (2019). Customs Procedures for the Import of Goods into Russia - Russia Briefing
News. Retrieved 7 November 2019, from https://www.russia-briefing.com/news/customs-
procedures-import-goods-russia.html/
Country Rankings: World & Global Economy Rankings on Economic Freedom. (2019).
Retrieved 7 November 2019, from https://www.heritage.org/index/ranking