The Ukrainian Agricultural Council (UAC), within the current week, will send proposals to the Ministry of Finance to combat the shadow agricultural market in Ukraine. Vice-chairman of the UAC, Mikhail Sokolov, presented relevant initiatives on Friday, August 31, during a meeting of the Ministry of Finance, which discussed ways to reduce the share of the shadow grain market and the return of foreign exchange earnings from grain crop operations.

Currently, in Ukraine, the tax burden on legally cultivating 1 hectare of commodity agricultural land is over 1400 UAH, while "shadow farmers" pay up to 100 UAH per 1 hectare.

As a result, officially working agricultural producers lose their competitiveness in the market of rental rights in relation to "shadow". In 2017, the share of land in the shadow processing reached about 30% of all agricultural land.

This creates a shadow market for illegally produced products.

In order to overcome the mentioned problem and fight against "shadow" farmers, UAC offers:

1) To regulate in the Tax Code the issue of introducing the minimum passive income that the owner may receive from his property and set its limit values. For example, the ownership or use of a taxpayer of a plot of agricultural land with an area of ​​more than 1 hectare will mean that the state will have its income from its use. The defined income will be used to calculate the amount of tax at the established rate of personal income tax. In this case, the decision on the introduction of minimum passive income and its exact size should be assigned to the powers of local self-government bodies.

2) To introduce differentiated rates of the single tax for the fourth group, according to which the specific rate of tax on 1 hectare will depend on the category of agricultural land, or land water fund.

3) provide for the payment of personal income tax on real estate, including land (units), to local budgets at the location of such real estate. This will create a real incentive for local governments and tax inspectorates to seek full payment of income taxes derived from the use of the relevant property, and thus to deal with the shadow real estate market.

Moreover, only the bodies of local self-government and the bodies of the State fiscal service in the territory of which such property is located, and not those where its owner is registered, will be able to control the way in which the relevant property will be used in reality.

Earlier, the issue of the importance of disinfection of the grain market in Ukraine was announced by the UAC August 27 during a round table on the priorities of the Verkhovna Rada Committee on Agrarian Policy and Land Relations for the period of the 9th session of the Verkhovna Rada of the 8th convocation.