Farmers’ associations yet to decide how to handle VAT rise

Farmers’ associations express their disdain with the VAT rise from 8 to 20% for agricultural products (with a difference refund to the farmers), a measure that is stipulated in the fiscal and customs policy for 2013. Next week the associations will convoke their councils to develp a plan of action in response to the measure, reports Info-Prim Neo. Head of the National Farmers’ Federation Vasile Mirzenco said that increasing the VAT will not only negatively affect farmers, but the economy as a whole, including the Budget that will have to refund more money and, based on previous years, will accumulate debt. “As for producers, the most affected will be middle and small farm businesses, which do not pay VAT, and will not receive refunds for purchasing means of production. Yet these are the ones who create most of the jobs, including for members of the farmers’ families”, Vasile Mirzenco specified. Alexandru Slusari, head of the National Union of Agricultural Producers “UniAgroProtect” stated that the Budget will not benefit from the VAT increase. On the contrary, they will have even more fiscal administration issues, procedures will become more bureaucratic, and inspections will become more frequent and harsher. According to Slusari, the VAT refund mechanism reminds him of a ping pong game. It would be for the best if the VAT funds stay in the enterprises’ accounts. According to Aliona Mandati, head of the Agricultural Product Exporters’ Association (APEA), the VAT increase seems to be a short-run benefit for the exporters, but only in the short run, because it causes producers to lose capital, who will have diminished shipments due to this year’s weather. For this reason, the APEA supports its colleagues from other agricultural organizations. Petru Stratan, from the “Moldovafruct” Fruit Producers Association, said that these increases may become more sizeable for fruit producers as time goes by; this year the latter will have around 10% losses, because of the bad weather. Representatives of the agricultural associations expressed their discontent with the Government’s and Parliament’s way of consulting with the agricultural sector on these policies. “We have had consulting sessions, roundtable discussions, we have presented arguments, studies, we had invited experts, and ultimately none of our proposals have been accepted”, said Iurie Hurmuzache of the Agroinform Federation. Vasile Mirzenco of the National Farmers’ Federation also mentioned that consulting the production representatives was mostly Moldova’s way to show the international community that our Government is loyal to democratic values, but the opinion exchange was pretty much a farce. “Currently, Moldovan agriculture has many wrongdoers. The Government and Parliament are wrongdoers; they prejudice agriculture through the policies they adopt”, concluded Mirzenco. The bill for fiscal and customs policies for 2013 was adopted by the Parliament this week.