Russia plans new tax on electronics to boost its defence capacity

Core Points - Russia is introducing a new tax on electronics, primarily targeting imported consumer items, with an expected revenue of $2.7 billion to support the domestic electronics industry, including defense [1][2][4] - The new tax is part of broader fiscal measures, including VAT increases and taxes on small businesses, aimed at balancing the state budget amid high military spending and declining energy revenues [2][3] - The tax will be implemented in September 2026, with a focus on imported smartphones and notebooks, and will later extend to their components [3][4] Industry Implications - The electronics industry is deemed strategic for Russia, with import substitution being critical for maintaining the country's defense capabilities [3][4] - The lack of access to modern electronics has hindered Russia's competitiveness in artificial intelligence development, which relies heavily on advanced computing power [2] - The government plans to allocate tax proceeds to special funds dedicated to supporting domestic producers in the electronics sector [4]