Meat may rise in price by 10% due to additional VAT on feed

MEAT will rise in price if importers of feed additives are charged additional VAT for the last three years. The Ministry of Finance and the Ministry of Agriculture interpret the legislation on the list of goods,

The cost of beef, pork, and poultry meat in RUSSIA may grow by at least 10% in the event that importers of feed additives are charged additionally - 4–7 billion rubles. VAT, the Izvestiya newspaper writes, citing the National Feed Union and the documentation of the Ministry of Agriculture, which it has read.

The problem with the amount of VAT on imported feed additives appeared due to different interpretations of the government's decree on the list of goods taxed at a reduced rate, the press service of the Ministry of Agriculture told the newspaper. Later, the government adopted amendments to the document, where the preferential status of additives was clearly spelled out. These changes are effective April 1, 2019.

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The Ministry of Agriculture believes that the amendments were made to get rid of uncertainty, and they do not change the status of taxation of additives. The Ministry of Finance also insists that importing companies must pay extra VAT in excess of the preferential rate, the newspaper writes, citing the minutes of the meeting at the Ministry of Agriculture.

“According to preliminary estimates, the amount of additional charges will be 4-7 billion rubles,” the publication quotes from the protocol of the Ministry of Agriculture. The ministry believes that the use of an increased VAT rate will lead to a rise in the price of meat.