Moldova and Russia sign Protocol on collection of indirect taxes according to destination country

Moldova and Russia signed the protocol on collection of indirect taxes according to the destination country. The document was signed by Minister of Economy and Commerce of Moldova Igor Dodon and Russian Deputy Minister of Finances, State Secretary Serghei Shatalov. According to a press release from the Ministry of Economy and Commerce, for the first time since Moldova’s independence, the value added tax on the Russian goods, and first of all for the natural gas and petroleum products delivered to Moldova will not be collected in Russia. Thus, Moldova and Russia have exhausted the entire package of mutual commitments within the bilateral trade and economic relations. From this point the bilateral economic relations of Moldova and Russia fully meet the standards and rules of the World Trade Organisation, the press release says. Economic expert Veaceslav Ionita told Info-Prim Neo that the accession of Russia to WTO will generate losses for the budget of Moldova totalling MDL 150 mln. According to Ionita, before the ban on wines, Russia was the only country which Moldova was registering a positive trade balance with, meaning that the exports were higher than the imports. Once Russia implemented the standards of the WTO and allowed the imports of agricultural products and wines to Russia, the VAT Moldova would obtain from the imported goods would be much lower than the tax Moldova has to refund to the companies exporting products to Russia. Ionita specified that when a company exports a certain good, the VAT, which is included in the price of the declared good, is refunded at the customs points because the company would have to pay the tax in the destination country. Moldova and Russia signed the Bilateral Protocol on accession of Russia to WTO in Moscow in early 2007.