Discriminatory “soybean amendments” have been abolished

17/ 01/ 2020

On January 16, the fair conditions of taxation and fair competition in the agrarian market were finally restored - VAT refunds for Ukrainian oilseed exporters were resumed. Thus, representatives of the EBA Grain & Oilseeds Committee have repeatedly emphasized the importance of the prompt adoption of a legislative decision to restore VAT refunds on soybean and rapeseed exports. After all, soy and rapeseed are some of the most export-oriented crops. Business welcomes this decision, as the agrarian community has been waiting for it for about two years. The European Business Association wishes to express its sincere gratitude to the Members of Parliament, to the Ministry of Economy, and to all the representatives of the grain business community who supported this important initiative. Reference: In December 2017, the Verkhovna Rada adopted the so-called soybean-rapeseed amendments, which deprived producers and exporters of the right to receive state financial support through the VAT refund mechanism for the export of soybeans (from 01.09.2018 to 31.12.2021) and the export of rapeseed (from 01.01.2020 to 12.31.2021). Moreover, on September 1, 2018, additional rules were introduced by the Law On Amendments to Subsection 2 Section XX “Transitional Provisions” of the Tax Code of Ukraine on certain issues of taxation of value added tax on export operations outside the customs territory of Ukraine 2440-VIII of May 22, 2018, which returned the right to refund VAT but only to the enterprises that grow the abovementioned produce on agricultural land. Farmers and exporting companies that did not have agricultural status remained outside the VAT refund system. It pushed them out of the market and made the market less competitive. It is worth noting that at the end of last year, the President of Ukraine called on the Government and the Verkhovna Rada to ensure the adoption of the law on the immediate elimination of discriminatory soybean amendments.

On January 16, the fair conditions of taxation and fair competition in the agrarian market were finally restored – VAT refunds for Ukrainian oilseed exporters were resumed.

Thus, representatives of the EBA Grain & Oilseeds Committee have repeatedly emphasized the importance of the prompt adoption of a legislative decision to restore VAT refunds on soybean and rapeseed exports. After all, soy and rapeseed are some of the most export-oriented crops.

Business welcomes this decision, as the agrarian community has been waiting for it for about two years. The European Business Association wishes to express its sincere gratitude to the Members of Parliament, to the Ministry of Economy, and to all the representatives of the grain business community who supported this important initiative.

Reference:

In December 2017, the Verkhovna Rada adopted the so-called “soybean-rapeseed amendments,” which deprived producers and exporters of the right to receive state financial support through the VAT refund mechanism for the export of soybeans (from 01.09.2018 to 31.12.2021) and the export of rapeseed (from 01.01.2020 to 12.31.2021). Moreover, on September 1, 2018, additional rules were introduced by the Law “On Amendments to Subsection 2 Section XX “Transitional Provisions” of the Tax Code of Ukraine on certain issues of taxation of value added tax on export operations outside the customs territory of Ukraine 2440-VIII of May 22, 2018, which returned the right to refund VAT but only to the enterprises that grow the abovementioned produce on agricultural land. Farmers and exporting companies that did not have agricultural status remained outside the VAT refund system. It pushed them out of the market and made the market less competitive. It is worth noting that at the end of last year, the President of Ukraine called on the Government and the Verkhovna Rada to ensure the adoption of the law on the immediate elimination of discriminatory soybean amendments.