Automotive Industry

Prospects for the development of the automotive industry

• The automotive industry is one of the key sectors of the economy, creating a multiplier effect for other industrial sectors of the Russian Federation.
• The automotive industry is a priority due to high investment activity, considering that vehicle and component manufacturers are major foreign investors.
• The current economic situation is more conducive than ever to localization of production, especially for technologically complex components and assemblies, primarily engines, transmissions, chassis, and electronics.
• The Leningrad Region implements a long-term policy of innovative development of the region as a business-friendly location.

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Strategic documents

Strategy for the development of the automotive industry of the Russian Federation for the period up to 2025, approved by Decree of the Government of the Russian Federation dated 28.04.2018 No. 831-r.

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State support

State support at the regional level:

• reduction of the corporate income tax rate (from 17% to 13.5%)
• reduction of the corporate property tax rate (from 2.2% to 0%) (Law of the Leningrad Region dated 29.12.2012 No. 113-OZ – for enterprises implementing investment projects in the Leningrad Region)
• reimbursement of actual expenses for employee transportation and expenses for vocational training, retraining and advanced training of personnel (Decree of the Government of the Leningrad Region dated 31.05.2017 No. 190 "On approval of the Procedure for granting subsidies from the regional budget of the Leningrad Region to reimburse costs to enterprises of the automotive industry of the Leningrad Region within the framework of the subprogram 'Development of Industry and Innovations in the Leningrad Region' of the state program of the Leningrad Region 'Stimulation of Economic Activity in the Leningrad Region' and on invalidating certain decrees of the Government of the Leningrad Region")
• reduction of the corporate income tax rate within the framework of SPIC (from 17% to 5%) and reduction of the corporate property tax rate (from 2.2% to 0%) (Law of the Leningrad Region dated 29.12.2017 No. 93-oz "On certain incentive measures in the industrial sector of the Leningrad Region and on amendments to certain legislative acts of the Leningrad Region")

State support at the federal level:

• provision of loans at a rate of 1 to 5% per annum for up to 5 years in the amount of 50 to 500 million rubles (program "Development Projects", program "Components" of the Industrial Development Fund)
• subsidies to automotive organizations to reimburse part of the costs of paying interest on loans attracted in 2015 for the purpose of refinancing and (or) acquiring rights of claim under loans and borrowings previously attracted by their subsidiaries and dependent companies (Decree of the Government of the Russian Federation dated 22.02.2018 No. 186)
• special program to support exports – compensation of part of the costs of transporting products to organizations, including organizations of the automotive industry, agricultural engineering, transport engineering and power engineering (Decree of the Government of the Russian Federation dated 26.04.2017 No. 496)
• subsidies to compensate costs associated with the production of wheeled vehicles, as well as components and assemblies for them (Decree of the Government of the Russian Federation dated 26.10.2018 No. 1278)
• subsidies to manufacturers of wheeled vehicles to compensate part of the costs of R&D and testing of wheeled vehicles (Decree of the Government of the Russian Federation dated 15.01.2014 No. 29)