The American Chamber of Commerce in Ukraine (the Chamber) welcomes the adoption of the Draft Law #5425-d amending the Tax Code of Ukraine regarding the VAT on transactions for the supply of certain types of agricultural products (Draft Law), that was supported by the MPs during the plenary session of the Verkhovna Rada of Ukraine on July 1, 2021.
The adopted Draft Law maintains reduced 14% VAT on transactions for supply of certain types of agricultural products, classified due to the following UKTZED codes: 1001, 1003, 1005, 1201, 1205, 1206 00.
On December 2020, the agrarian business welcomed the adoption of the Law of Ukraine #1115-IX “On Amendments to the Tax Code of Ukraine Concerning the Value Added Tax Rate on Transactions for Supply of Certain Types of Agricultural Products”, that introduced a reduced 14% VAT for certain types of agricultural products.
Experts of the Chamber Agricultural Committee have repeatedly stressed, that 14% VAT on transactions for supply of certain types of agricultural products (inter alia with above mentioned UKTZED codes) facilitates:
- reducing the tax burden on business;
- de-shadowing producers of agricultural products;
- ensuring proper servicing of public debt;
- harmonizing respective national and EU regulation in the part on the application of reduced VAT rates in taxation of certain types of agricultural products.
The Chamber will continue to support the necessity to maintain a reduced 14% VAT for certain types of agricultural products classified by above mentioned UKTZED codes.