Uzbekistan to reduce VAT rate on agricultural products from farmers to zero starting Jan 2026
TASHKENT. Sept 5 (Interfax) - The Uzbek authorities will reduce the value-added tax rate on the sale of agricultural products by farmers from the current 12% to zero starting next year.
"With the participation of the International Monetary Fund, as well as foreign and local experts, proposals have been prepared to bring the agricultural sector out of the shadows. According to these proposals, starting January 1 next year, farmers and personal subsidiary plots will be subject to a zero VAT rate when selling their own products," Uzbek media reported on Friday following a meeting held by President Shavkat Mirziyoyev, where the issue of reducing the shadow economy in the agricultural sector was discussed.
The preferential rate will apply to the sale of fruit, vegetables, meat, milk, eggs and other agricultural products, with the exception of cotton and grain, the media said.
At the same time, the practice of refunding paid VAT on seeds, fertilizers, fuel, transportation, electricity and other production expenses will remain. It is expected that, as a result, farmers and personal plots will retain an additional approximately 300 billion som annually. They will be able to recover another 400 billion som through the new benefit.
"Overall, these measures will stimulate transparent operations in the industry and create a basis for increasing the number of large industrial-type plantations and enterprises for processing agricultural products," the media said.
In recent years, structural reforms have been carried out in Uzbekistan's agricultural sector, and measures have been taken to increase its efficiency. The acreage for cotton and grains has been reduced and reoriented to growing food crops. A total of 160,000 hectares of new orchards and vineyards have been established, and 1,500 projects in the food production sector worth a total of $1 billion have been implemented.
The official exchange rate on September 5 is 12,437.15 som/$1.
