Rethinking luxury: how car value bands influence tax treatment
Luxury status for cars has shifted as market prices rise. What used to trigger luxury classification was a threshold of 3 million rubles, but since 2014 the benchmark has moved. Recently, the floor for luxury designation was raised to 10 million rubles, reflecting a sharp jump in vehicle prices over the years. This change means that many vehicles once considered standard now sit at the edge of or above the new luxury line, altering how they are treated in terms of taxation and regulation.
As prices climbed, the Ministry of Industry and Trade broadened its definition of luxury models to include some mass-market vehicles. Examples cited during the transition included a crossover like the Skoda Kodiaq and an SUV model that exemplified the expanding luxury band in practical terms. The policy shift acknowledges that even mid-range vehicles can carry features, prestige, or performance levels that push them into the luxury category for regulatory purposes.
Under the new framework, vehicles valued between 3 million and 10 million rubles, purchased after January 1, 2022, are no longer categorized as luxury. Consequently, owners of these cars do not face the increased transport tax that previously applied to higher-end models.
Before the amendments were signed, the luxury-car list contained 1,380 items, with 1,035 of those priced between 3 and 10 million rubles. With the update, the roster contracts to 345 items, reshaping how many models are subject to luxury classification and the related tax implications. This consolidation reflects a broader effort to modernize tax policy in step with the evolving automotive market. (Cited from Ministry of Industry and Trade, 2022)