Shipping Cars to Kyrgyzstan - Major Shift in Import Duties

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Shipping Cars Overseas - Impact to Buyers & Sellers

Since the break-up of the USSR, the independent states have been able to trade with countries outside the former Soviet Union. This new freedom prompted change as these young governments forayed into the complex world of international commerce. One marked change has been the formation of economic alliances that seek to benefit from uniform tariffs and trade policy. Until recently, Kyrgyzstan set policy and maintained control over its own customs regulations on imported goods and services.

Since historically the Kyrgyz Republic has relied heavily on imports for economic development, there has been strong incentive to keep their import tax rates low and arguably it has worked. For example, in 2012  shipping cars internationally to Kyrgyzstan was a booming business. That year $273 million in cars alone were brought into the country at only a 10% duty. Low by comparison, their competitive tariffs have encouraged imports, resulting in more revenue than the collections of higher cost Uzbekistan, Turkmenistan and Tajikistan combined.

Read also Shipping Cars Overseas to Asia & Central Asian States

It appears things will be different going forward. In May of this year, Russia, Kazakhstan and Belarus signed a treaty that formed the Eurasian Economic Union, more commonly known as The Customs Union. This has created a powerful, Eurasian economic and geographic entity intended to compete with the European Union. Kyrgyz officials have asked to join the Union in 2015, with the understanding it will take five years to complete the process.

What Exporters Need to Know

What exporters need to know, is that apparently part of that 5 year process and the price attached to membership, will be the need for Kyrgyzstan to raise its import duties to align more closely to that of other member states. West Coast Shipping (WCS) expects to see increases soon, anticipating a doubling in fees for the most popular cars starting as early as October 1, 2014.  WCS also predicts duties to quadruple in the not too distant future.  At present it is difficult to measure how Kyrgyzstan's decision will affect exporters shipping cars to Kyrgyzstan, international car importers and to its own citizenry.

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West Coast Shipping will be following this situation closely and will keep you up-to-date and informed.

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