The Ukrainian Agri Council (UAC), which represents more than 1,300 small and medium-sized agricultural enterprises from all regions of Ukraine, has appealed to the leaders of parliamentary factions and groups in the Verkhovna Rada of Ukraine with an urgent call not to allow the adoption of amendments to draft law No. 13134 " On Amendments to the Tax Code of Ukraine Regarding Expanding Patient Access to Medicines Subject to Purchase by a Person Authorized to Make Purchases in the Field of Health Care Through the Conclusion of Managed Access Agreements," which provide for the introduction of permanent export duties on soybeans and rapeseed.

It is talked about amendments supported on June 13, 2025, by the Committee on Finance, Tax, and Customs Policy, which establish an export duty of 10% — except in cases where exports are carried out directly by an agricultural producer or an agricultural cooperative that unites them.

The Ukrainian Agri Council strongly opposes the proposed changes for several key reasons.

Firstly, they discriminate small and medium-sized agricultural enterprises, which, due to limited production volumes, do not have the technical or economic capacity to export their products independently and therefore cannot take advantage of the exemption from customs duties.

Secondly, the underdevelopment of agricultural cooperation in Ukraine is a direct consequence of the lack of tax incentives for cooperatives, in particular the exemption from taxation of patronage dividends, which is common practice in countries with successful agricultural cooperative systems.

Thirdly, the amendments are manipulative in nature — their purpose is to artificially reduce purchase prices for soybeans and rapeseed by restricting exports. According to the explanations of the initiators of the restrictions themselves, Ukraine already has sufficient processing capacity to process the entire volume of soybeans and rapeseed grown. The only reason for their underutilization is the unwillingness of some processors to pay agricultural producers a competitive price for raw materials.

In addition, such changes violate the Agreement on Association with the EU, which prohibits the introduction of new permanent export duties, and the proposed amendments have no time limits and effectively establish duties on a permanent basis.

The UAC calls for a review of these proposals, taking into account the interests of all participants in the agricultural market and Ukraine's international obligations.

The UAC also recalls that the experience of the so-called “soybean amendments” of 2017 has already clearly demonstrated that such initiatives lead to a fall in purchase prices in the short term, a reduction in acreage, and subsequently to a reverse increase in prices, but on a significantly reduced production base. As a result, this does not stimulate development but, on the contrary, leads to a reduction in agricultural GDP, although it allows individual processors to temporarily increase their profits.

A repeat of this scenario in 2025 is unacceptable and strategically meaningless from the point of view of Ukraine's long-term interests. This decision will not only hit the country's agricultural GDP, but will also effectively contradict the state's European course,” the UAC said in a statement.

The UAC calls on the heads of the Verkhovna Rada factions to put the amendments to draft law No.13134 to a separate vote during consideration in the session hall and to vote against their inclusion in the final text of the law.

The agricultural community expects the parliament to make balanced decisions that will not destroy the economic foundations of Ukrainian villages and will not contradict Ukraine's international obligations.

Monday, 16 June 2025

 

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