OREANDA-NEWS. July 16, 2012. This was stated by the Chairman of the Confederation of farmers of Moldova at a press conference “ Farmers’ point of view on the raise of VAT from 8% to 20%”, attended by representatives of the Federation of Farmers of Moldova, Uniagroprotect, Agroinform, Association of Exporters and Importers of Fruit, the Association of Exporters of Agricultural Products and Crops.

According to Vasile Mirzenco, the law was passed without taking into account proposals by growers although authorities agreed on their reasons earlier. He states the dialog with civil society is falseness. The raise of VAT will result in losses of hundreds of millions leis in the budget, an increase in prices for goods and uncompetitive enterprises of Moldova, he stresses. According to Alexandr Slussari, Chairman of Uniagroprotect, the raise is a strategic error in the development of agriculture encouraging bureaucracy, corruption and shady economy. Agricultural NGOs expressed the unanimous position in insisting on cancellation of the raise or on revision of the recovery mechanism.

Since agribusinessmen receive seasonal incomes, producers may have no funds to pay the VAT. As a result, they will be forced to ask for credits. Besides, there is the risk that the state will fail to refund the 12% difference within 30 days and the situation of 2006-2009 will arise again, when authorities owed to farmers 250 mln leis.

That is why growers insist that at least 60% of the sum refunded have to be left on accounts of enterprises initially. According to Alexandru Slusari, the explanatory note to the law runs that the raise of VAT will place producers in equal conditions and sour activity of processing enterprises. However, EU and CIS states saw declines of VAT and processing plants there export goods and are refunded 20% of the tax.

“It is meaningless to create more favourable conditions for them to the prejudice of all growers of Moldova” Alexandru Slusari said.