News
18.02.2010
Agrarian companies have favorable conditions for development - expert
Ukrainian agrarian companies have favorable conditions for development thanks to low expenditures for expansion of the land bank and a special taxation mode, analytical report by the BG Capital investment company reads.
The report says that a ban for selling agricultural lands in Ukraine ensures competitive advantages to Ukrainian agricultural companies. A moratorium for purchase-sale of agricultural lands, being a deterrent for new companies to enter the sector, postpones demand for land in time and cost escalation for expansion.
The BG Capital analysts also note that profitable agrarian companies in Ukraine are able to substantially economize on taxes due to a special taxation mode. In compliance with the Ukrainian legislation, there exists a zero VAT rate for agricultural producers and they have a right to pay a fixed agricultural tax instead of a profit tax that also allows abating a tax load. Both mechanisms of indirect funding depend on profitability, the more the company earns from one ha of land the more it economizes. According to the report, such support can reach 30% of agrarian companies' net profit.
UKRINFORM
