EVR Cargo to set up subsidiary in Russia

The Estonian state owned rail cargo operator EVR Cargo is planning to set up a subsidiary in Russia to be able to rent out railcars on the Russian market on more favorable terms, reported LETA/BNS.

For EVR Cargo it becomes necessary to establish a subsidiary in Russia if it wishes to rent out railcars in Russia, in order to avoid double taxation, EVR Cargo manager Raul Toomsalu said at a meeting of the company's supervisory board.

If the cars are rented out directly by a company registered in Estonia, a tax of 10-20% would be levied depending on whether or not the cars operate also outside Russia.

Using the cars for operation within Russia alone would mean a tax rate of 20%. In addition to that comes the topic of customs, as railcars registered in Estonia can be used in Russian territory only if a temporary import duty of 5 euros per railcar per day is paid on them, which would make it pointless to rent the cars to Russia at the intended price of 13 euros a day.

(Source: http://www.baltic-course.com/eng/transport/?doc=128692)

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