The Ukrainian Agri Council calls on the Cabinet of Ministers to fulfill the requirements of the Law of Ukraine No. 3878-IX “On Amendments to the Tax Code of Ukraine on the Implementation of the Provisions of the European Union Law on Excise Tax”, which instructed the Government to develop and submit to the Verkhovna Rada a draft law on establishing a preferential excise tax rate on fuel used by agricultural machinery.

This law came into force on September 1, 2024 and gave the Cabinet of Ministers of Ukraine three months to consider the introduction of a 0.5 reduction factor to the excise tax rates on heavy distillates (gas oils) intended for use by agricultural producers.

It has been three months since Law No. 3878-IX came into force, but the relevant order has not yet been implemented. However, on September 10, 2024, the Cabinet of Ministers issued a corresponding order No. 28359/1/1-24. According to this document, the Ministry of Finance, the Ministry of Agrarian Policy, the Ministry of Economy, the Ministry of Digital Transformation, the Ministry of Justice, the State Tax Service and the State Customs Service, with the participation of the interested bodies, were instructed to take the necessary measures by November 11, 2024, inform the Verkhovna Rada of Ukraine and the Cabinet of Ministers of the results and submit a relevant draft act to the Cabinet of Ministers in accordance with the established procedure.

We remind that according to this law, the excise tax on fuel will gradually increase from EUR 139 to EUR 330 per thousand liters by the end of 2028. At the same time, the excise tax on fuel for European farmers in most EU countries and Ukraine's neighbors does not exceed EUR 70, which puts Ukrainian farmers in a non-competitive position.

The UAC calls on the Government to comply with the law and urgently fulfill its obligations to agricultural producers by introducing a reduction in the excise tax on fuel.