Economy

Real Russian market for fur products is 16 times bigger than the official statistics

Russia is expanding the system of control over financial and commodity flows at the national and supranational levels within the EEU.

On 28 September 2016 at a meeting of the state Commission to counter illegal turnover of industrial products Mikhail Mishustin, head of Federal Tax Service (FNS), has demonstrated to the Minister of industry and trade Denis Manturov information system of labelling and monitoring on the fur market. The new system implies mandatory labeling of product with radio-frequency labels (RFID) and control system of goods, from the manufacturer or importer till the retail network. It also covers secondary market, for example, a thrift shop to put the goods on sale should it be marked.

In test mode, the voluntary system was introduced on 1 April 2016 on the territory of Russia and Belarus. From 12 August 2016 the labelling of fur products became mandatory. After today will become impossible to to sell fur products without labels legally. Later, the system will cover Kazakhstan, Kyrgyzstan, and Armenia too.

Denis Manturov, Minister of Industry and trade of the Russian Federation
Denis Manturov, Minister of Industry and trade of the Russian Federation

Michael Mishustin has shared the first results of introduction of the labeling: the system registered more than 5’900 participants of the fur market (20% of them for the first time legalized, 85% of participants are self – employed individuals). In 1.5 month more than 5.6 million marks were ordered, which is 16 times more than the official statistics of Rosstat and the Federal Customs Service for the entire 2015. More than 50 thousand labeled products, which is 2.5 times more data and marketing research in the accounting period in 2015, are already sold in retail. The average retail margin of the products comparing to the customs value is 114%.

According to Denis Manturov, before the introduction of the labelling system the fur market was estimated at 270 thousand units (production at 70 thousand units, the import at 200 thousand PCs). According to the results of the pilot study, its size is estimated at about 5 million units. Thus, the state experiment has significantly increased tax revenues to the budget.

The subsequent goods, which will be included in the labelling system in 2017, will be the medicines and wood (Irkutsk region). When ready, labelling will be introduced sector by sector in the prepared regions of the country, and gradually spread throughout the country and the Eurasian economic Union.