President Zelenskyy signed VAT reduction to 14% for agriproducers
President of Ukraine Volodymyr Zelenskyy signed the Law No. 1115-IX "On Amendments to the Tax Code of Ukraine Concerning the Value Added Tax Rate on Transactions for the Supply of Certain Types of Agricultural Products" adopted by the Verkhovna Rada (Parliament) on 17 December 2020.
The law provides for the reduction of the VAT rate from 20% to 14% for shipments and imports to Ukraine of certain agricultural products, including cattle, pigs, whole milk, wheat and rye, barley, oats, corn, soybeans, sugar beet, flax seeds, colza or rapeseed, sunflower and other oilseed crops.
It is noted that the law seeks to guarantee support for agricultural production in Ukraine, attract investment in the sector and enhance the competitiveness of domestic agriculture.
"The implementation of the law will also reduce taxpayers' incentive to reduce VAT obligations on transactions with the respective products, cut budget losses and contribute to de-shading in agriculture production," the message reads.
Previously reported that the MP group Dovira (Довіра), which is affiliated with Kernel founder and co-owner Andrey Verevskiy, lobbied the parliamentary committee on finance, tax and customs policy to reduce the VAT rate to 14%. Despite the number of commodity groups that come under the reduced VAT rate, experts say that only sunflower processors will see an economic effect.