Zero VAT rate to be introduced in agriculture

A simplified procedure for calculating value-added tax (VAT) in agriculture will be introduced. This is stated in the presidential decree of September 4, 2024, titled “on measures to introduce a simplified procedure for calculating value-added tax in agriculture”.

It is stated that the main objective of the decree is to increase the official turnover in the agricultural sector by at least threefold during 2026–2027.

According to the decree, starting from January 1, 2026:

• A zero VAT rate will be applied to the sale of agricultural products produced by agricultural producers;
• VAT refunds to agricultural producers will be carried out automatically within three days.

In addition, from January 1, 2026, a system will be introduced to automatically analyze electronic invoices in real time based on their risk level when accounting for VAT amounts within a single supply chain.

It is stipulated that the share of high-risk electronic invoices must not exceed 10 percent of the total number of electronic invoices issued during the reporting period.

It was reported earlier that starting from January 1, 2026, agricultural enterprises will apply a zero VAT rate when selling their own agricultural products (excluding grain and cotton) to farmers and peasants.