Russia considers implementation of split payments for e-service transactions

28 July 2017

In an effort to prevent VAT fraud, Russia is considering introducing a VAT split payments regime on the sales of e-services.

If introduced the split payment procedure would require online market places (such as Amazon and E-bay) to collect the VAT at 18%, which is due on these types of sales, directly from the consumer. The online market place would then pay these VAT amounts directly to the Russian tax authorities before passing the remainder of the sales amount back to the service provider.