20% VAT is back for some agricultural products
02/07/21
On July 1, 2021, the Verkhovna Rada of Ukraine adopted a draft Law1 which partially abolished the reduced rate of 14% VAT for some agricultural products introduced on March 1, 2021.
The 20% VAT rate should be applied again to transactions that will take place from the first day of the month following the month of publication of the Law. Therefore, taxpayers will have to apply the changed rate no earlier than August 1, 2021.
The distribution of agricultural products by rates will be the following:
The rate of 14% VAT |
The rate of 20% VAT |
1001 (wheat) 1003 (barley) 1005 (corn) 1201 (soybeans) 1205 (seeds of rape) 1206 00 (sunflower seeds) |
0102 (cattle, live) 0103 (pigs, live) 0104 10 (sheep, live) 0401 (in part of whole milk) 1002 (rye) 1004 (oats) 1204 00 (flax seeds) 1207 (seeds and fruits of other oilseeds) 1212 91 (sugar beets) |
In addition, the Law sets out the specific rules for adjusting tax liabilities originating from the transactions started before and closed after the enforcement of this Law.
We will continue to monitor changes in the field of VAT on agricultural products and keep you informed of further developments.
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1 Draft Law of Ukraine "Of the Law on Amendments to the Tax Code of Ukraine Concerning the Value Added Tax Rate in Taxation of Transactions on Supply of Certain Types of Agricultural Products" № 5425-d dated 14.06.2021 (further - "the Law")
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