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20% VAT rate on certain types of agricultural products has been resumed

The Main Department of the State Tax Service in Kyiv reminds that from August 1, 2021 the application of the basic VAT rate of 20% for operations on supply in the customs territory of Ukraine and import into the customs territory of Ukraine of certain types of agricultural products was resumed.

Such changes are provided by the Law of Ukraine of July 1, 2021 № 1600-IX “On Amendments to the Tax Code of Ukraine on the rate of value added tax in the taxation of transactions for the supply of certain types of agricultural products” (hereinafter – Law № 1600) and apply to the following commodity positions according to UKT FEA: 0102, 0103, 0104 10, 0401 (in the part of whole milk), 1002, 1004, 1204 00, 1207, 1212 91 (hereinafter – agricultural goods defined by Law № 1600).

Please note that in connection with the restoration of the value added tax rate of 20% on the supply of agricultural goods, defined by Law № 1600, the following features are established:

1) if the first event in the supply of such agricultural goods occurred before the entry into force of Law № 1600, the recalculation of the value added tax rate and the amount of tax on the date of the second event is not carried out;

2) if after the entry into force of Law № 1600 there is a refund of advance payment (advance) or delivered agricultural goods, in connection with the reduction of the quantity or value of such agricultural goods, the first event of delivery of which occurred before the specified date, adjustment of tax liabilities from the value added tax is carried out, proceeding from the rate of the value added tax of 14%;

3) if after the entry into force of Law № 1600 there is a supply of agricultural products, or transfer of funds in connection with an increase in the number or value of such agricultural products, the first event of which occurred before the specified date, adjusting the amount of tax liabilities the value is based on the value added tax rate of 20%.

In case the taxpayer carries out operations on supply in the customs territory of Ukraine of agricultural products specified by Law № 1600, which were purchased before the entry into force of Law № 1600, such taxpayer retains the value added tax credit in the amount accrued upon purchase of such agricultural goods.

For reference: the provisions of the Law № 1600 apply to tax periods starting from August 1, 2021.

Source: gov.ua

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