Leaders of the Agro-Industrial Complex for Subsidies from the State

by Olha Povaliaieva
Friday, December 3, 2021
Leaders of the Agro-Industrial Complex for Subsidies from the State

The Branch of the Agro-Industrial Complex that Has Received the Most Subsidies for the Last 20 Years

The main source of support for agricultural producers in Ukraine now is tax benefits (single tax of group 4) and state subsidies.

Previously, these measures included price support, i.e., state intervention in pricing due to export restrictions, setting minimum prices, or non-reimbursement of VAT on exports of cereals or oilseeds.

"In the industry division, the leaders in the amount of support received over the past twenty years are producers of chicken and beef. In general, until 2016, the following pattern was observed: export-oriented crop industries mainly suffered from government intervention in prices, while livestock mainly won and had considerable support," said Oleh Nyvyevsky, head of the Center for food research and land use KSE.

At the same time, sugar producers still receive significant support through a special trade regime — import tariff quota and import duty of 50%. On the other hand, wheat and corn producers have systematically suffered from government interference in trade, including export restrictions, export duties or quotas, and, until 2016, non-refund of VAT on grain exports.

“Since 2016, the state has minimized its influence on trade due to various export and import restrictions. Trade-in agricultural products, except for sugar, has been liberalized, which in turn contributes to economic development and greater competitiveness of the agricultural sector," said the head of the Center for food and land research.

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