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29 Jan, 14:56

Moscow, St. Petersburg top shopping hot spots for foreign tourists in 2024

It is noted that last year, in the Tula Region, the retail industry grew by 2.9% compared to 2023

SOCHI, January 29. /TASS/. Moscow and St. Petersburg were the most popular shopping destinations for foreign tourists in 2024, DigiTaxFree, a digital operator of the tax-free system in Russia, told TASS.

The Moscow Region, Sverdlovsk Region, and the Republic of Tatarstan also made it into the top five.

"The top cities to shop in 2024 for tourists were Moscow and St. Petersburg, followed closely by the Moscow and Sverdlovsk regions. The Republic of Tatarstan rounds out the top five regions," the operator's research found.

The agency noted that last year, in the Tula Region, the retail industry grew by 2.9% compared to 2023. The Tula and Tomsk regions, as well as the Chechen Republic, recorded growth in the number of retail stores throughout 2024. Seaside region Krasnodar ranked seventh in this metric. In the Trans-Baikal Region, retail growth amounted to 1.4% compared to 2023.

According to DigiTaxFree CEO Vadim Klementyev, retail growth in some parts of Russia is connected with an increase in the inbound flow of foreign tourists to Russia. However, Klementyev stressed that not all of Russia is experiencing this growth, as some regions saw a downturn in retail sales. "This discrepancy is due to the fact that to date only 21 Russian regions are involved in the experiment on value-added tax (VAT) refunds to foreign tourists, so despite the overall increase in tourists in some specific regions, there is no significant increase in tourist spending," he clarified.

According to the operator's data, Chinese tourists were the biggest users of the VAT refund program, accounting for approximately 70% of tax-free receipts issued in 2024. Tourists from South Korea (4%) and Vietnam (2%) also took advantage of the refunds.

DigiTaxFree highlighted the Murmansk, Tver, and Tula regions, as well as Karelia and Yakutia, as the most promising tourist destinations in 2025.

Russia’s tax-free system

On November 27, 2017, President Vladimir Putin signed a law amending the Russian Tax Code, thereby introducing a tax-free system in the country. It came into full force on October 1, 2018. Foreign tourists, except for citizens living in countries of the Eurasian Economic Union, can receive a refund on the VAT of their purchases, but no more than 12% at the full rate of 18%. The minimum purchase amount eligible for a refund is 10,000 rubles ($100). However, tourists still pay fees for the system's operation. The refund can be received in cash or credited to a bank account. The tax-free system does not apply to excisable goods, such as alcohol and cigarettes.