A New Recycling Fee Has Come into Effect in Russia, Significantly Increasing the Cost of Foreign Cars Over 160 HP: A Review of Changes, Impact on Buyers, and Price Forecasts Until 2030.
As of December 1, 2025, an updated procedure for calculating the recycling fee on imported passenger vehicles has come into effect. Under the new rules, a basic fee of 20,000 rubles is subject to coefficients that depend not only on engine displacement but also on its power. This means that vehicles with an output of over 160 HP are now charged at commercial rates, leading to fees that could reach hundreds of thousands or even millions of rubles instead of just a few thousand as was previously the case.
However, for vehicles with engines up to 160 HP, the preferential recycling fee remains in effect – estimates suggest that this category comprises around 80% of the vehicle fleet. Such vehicles are subject to the previous low fee (3,400 rubles for new models and 5,200 rubles for vehicles older than three years). Nevertheless, the combination of the new recycling fee and existing customs duties results in a sharp increase in the cost of importing foreign cars.
Who Will Experience Price Increases and By How Much
The new rules will particularly impact popular mid-range and premium vehicles in Russia with engines exceeding 160 HP. For example:
- Toyota Camry 3.5: additional recycling fee of about 2.9 million rubles (almost equal to the cost of the vehicle itself).
- Kia K5: approximately an additional 795,000 rubles.
- BMW M5: about 4.0 million rubles in additional fees.
- Lixiang L9: the recycling fee has increased from 3,400 rubles to nearly 2.0 million rubles.
These examples demonstrate the scale of the price increases: the total purchase price of a foreign vehicle along with the new fee will be several times higher than before.
Surge in Demand Before Price Hike
Expectations of sharp price increases have triggered a surge in the market even before the official implementation of the changes. In October 2025, approximately 12% of all passenger car sales were through "gray" imports (nearly 19,700 vehicles), as buyers rushed to import cars under the old rules. Far Eastern customs switched to round-the-clock operations to process as many vehicles as possible before December 1.
Simultaneously, sales of new passenger cars in October reached a record high of 171,200 units, the highest in the last 3.5 years. Additionally, without previous discounts and promotions, the average purchase price rose by about 20% over three months. This confirms the strong short-term demand and the population's readiness to make purchases ahead of a significant change in conditions.
Government Objectives: Protecting the Domestic Auto Industry and Budget Revenues
In official statements, the new recycling fee is positioned as a tool to support the domestic auto industry. According to First Deputy Prime Minister Denis Manturov, the new scheme aims to make local vehicle production in Russia more economically attractive than imports. Minister of Industry and Trade Anton Alikhanov noted that vehicles up to 160 HP comprise about 80% of the fleet, hence most private buyers are "not affected" by the new rules. President Putin has also emphasized the necessity of the recycling fee to support local manufacturers.
However, due to a reduction in the import of foreign cars, the budget might miss out on significant revenues. Experts estimate that annual revenue losses could reach up to 300 billion rubles (by comparison, in 2024, the recycling fee brought about 1.1 trillion rubles to the federal budget, of which over 600 billion were from imports).
Consequences for Buyers and the Market
The increase in the recycling fee will instantly raise the "entry barrier" for the used foreign car market and make many models unaffordable for private individuals. Average buyers will face a significant increase in vehicle costs: the recycling fee will constitute a substantial part of the final price. This will lead to a drop in demand for mid-range and high-power foreign cars and push car owners towards cheaper vehicles with engines up to 160 HP or domestic alternatives.
Overall, this suggests a massive restructuring of the market: foreign brands will lose some positions, while domestic manufacturing may gain additional momentum. According to estimates from the Ministry of Industry and Trade, passenger car sales in 2025 could drop by 13–16% (to 1.3–1.35 million units), reflecting consumer reaction to rising prices and changing tax burdens.
Future Dynamics: Recycling Fees Until 2030
Increases in the recycling fee will not stop here. Starting January 1, 2026, rates will rise further by 25%, followed by an annual indexation of 10–20% until 2030. Experts estimate that if this trajectory continues, by the end of the decade, the fee for the most powerful foreign cars will exceed 10 million rubles, making their import economically unfeasible.
- On January 1, 2026, recycling fees will increase by 25%.
- Annual indexation of 10–20% in 2027–2030.
- By 2030, the recycling fee for cars over 493 HP will exceed 10 million rubles.
Conclusions
The new rules for calculating the recycling fee have radically changed the conditions for importing foreign cars into Russia. The price of an imported vehicle now depends not only on displacement but also on engine power, leading to a rapid increase in prices for many models. In the short term, this will limit access to expensive foreign cars and increase demand for more affordable alternatives. In the long term, it will solidify the advantages of domestic manufacturers and reduce the presence of powerful foreign cars in the market.
For investors, these changes indicate a restructuring of the automotive market in Russia and the CIS. Foreign brands will lose some market share, while investments in local assembly may become more attractive. Moreover, the overall volume of car sales may decrease: owning a powerful foreign car may turn into a one-time luxury due to the increased tax burden and import restrictions.
