The Russian VAT Change on Hamburger and Similar Products
Recent announcements from the Federal Tax Service (FTS) confirm a shift in value added tax rates affecting a specific category of prepared foods in the Russian Federation. As of October 1, a 20 percent VAT was set to apply to sandwich-type culinary products, including hamburgers, cheeseburgers, and similar items. This update was published on the ministry’s official site and is intended to clarify how these products should be taxed under current Russian tax regulations.
The clarification identifies the targeted category as sandwich-type culinary products, namely hamburgers, cheeseburgers, and analogous offerings. This designation helps ensure that the tax treatment for these items aligns with broader policy goals for food taxation and revenue collection.
Previously, up to October 1, 2023, these products did not appear explicitly on the list known as List 908, which enumerates taxable culinary and food products at a 10 percent rate. However, items related to hamburgers had been included in that list, which permitted a 10 percent tax treatment for those products at that time. The change aims to eliminate ambiguity in how such items are categorized for VAT purposes.
To remove any uncertainty surrounding the tax treatment, the Federal Agency for Technical Regulation and Metrology issued an order on August 15, 2023. This order removed hamburgers from List 908 and clarified that similar products should not be taxed under the 10 percent rate. The scope of the revision also includes the exclusion of “frozen or otherwise preserved pizza” from the same list, reinforcing the effort to streamline VAT application to ready-to-eat and fast-food items.
Market context shows a concentrated pattern in the Russian catering sector. Three fast-food chains reportedly account for about 45 percent of total visits to catering establishments, underscoring the potential impact of VAT changes on consumer pricing and business strategy within the sector. The VAT adjustment for fast-food products is part of a broader conversation about how value added tax is applied to prepared foods and the consistency of tax treatment across different categories of quick-service meals.
Historically, policy discussions in Russia have weighed the merits of VAT on catered meals. The recent developments reflect ongoing efforts to refine tax rules governing the foodservice market and to address ambiguity for businesses that rely on fast-food and convenience meals. As the regulatory landscape unfolds, industry observers and operators are closely monitoring how these changes will influence pricing, menu strategy, and consumer behavior in the short and medium term.
In summary, the VAT for certain sandwich-style products, including hamburgers and cheeseburgers, has been elevated to 20 percent effective October 1. The revision, supported by an August 2023 order from the technical regulation authority, removes hamburgers from List 908 and excludes specific items like frozen pizza from the list. The shift marks a notable moment for the Russian foodservice sector, where a handful of major chains drive a large share of consumer traffic and where tax policy efforts aim to improve clarity and consistency in VAT application across the prepared foods category.