The Cabinet of Ministers of Ukraine has proposed that the single tax for the fourth group of taxpayers (agricultural companies) for the simplified taxation scheme is increased by 1.8 times.

The initiative is outlined in bill No. 3688 amending the Tax Code and some Ukrainian laws on the provision of the balance of budget revenues in 2016. The document was registered in the parliament on December 22.

According to the explanatory note to the bill, the government also insists on revoking the special VAT taxation regime for agricultural companies from January 1, 2017 and earlier apply the special regime paying 75% of VAT to the budget and 25% to the special account for own needs.

The bill foresees revoking of the special VAT taxation for supply of grain and industrial crops from January 1, 2016, and all taxpayers who will export grain will have the right to have VAT refunded from the budget.

According to the Tax Code, the tax rate per hectare of farmland and/or water fund land depends on the category of land and its location for the fourth group of taxpayers. The taxation base is the pecuniary appraisal of farmland, taking into account the indexation coefficient set as of January 1 of the basic fiscal year.

The rates for arable land, hayfields and grazing land is 0.45% of the taxation base, for arable land, hayfields and grazing land in mountains and forest areas – 0.27%, for perennial plantings – 0.27%, for perennial plantings in mountains and forest areas – 0.09%, water fund land – 1.35%; arable land, hayfields and grazing land for greenhouses – 3% of the taxation base.