The agricultural producers, regardless of their legal form of activity and of the fact whether they are registered as payers of VAT or not, may be exempted from paying value added tax when purchasing agricultural machinery. A bill to this effect was endorsed by the Parliament’s commission on agriculture and food industry, IPN reports.

One of the authors of the bill, Liberal-Democratic MP Ion Balan said that the given initiative will ensure equity when buying agricultural machinery. Currently, the agricultural producers – legal entities are able to get back the VAT after they purchase the machinery, while the small and peasants’ farms are unable to. Thus, the latter are disadvantaged.

The lawmaker also said that the agricultural producers have only seasonal sales and do not permanently have funds, while the agricultural machinery is very expensive. “In order to support them in their economic activity, the authorities should exempt them from paying VAT on the investments in agricultural machinery,” stated Ion Balan.

If the bill is adopted by Parliament, the agricultural producers will be exempted from paying VAT of 20% on the purchase of tractors, combines, mechanic pieces of equipment, machines and tools for agriculture.