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 Ministry of Finance Wants to Raise Land Tax by Three Times

The government plans to significantly increase revenues of local budgets by raising rates for the land tax in 2014.

Kommersant-Ukraine notes that the Ministry of Finance prepared amendments to the Tax Code which propose to revise the rate of payment for the land from 1 January 2014, raising them by three times. Currently the tax rate for arable land, hayfields and pastures is 0.1% of the normative monetary estimate per 1 hectare, or more than 20 hryvnias with the average regulatory assessment being 20.6 thousand as of January 1, 2012. However in a year the fee can amount to at least 68 hryvnias.

Areas of farmland to perennial rate will be charged at 0.09% instead of 0.03%. The same tax rate will be collected from the users of forest land who now only pay for the special use of forest resources. In addition, it is proposed to raise the rate for all other categories of land from 1% to 3% of the normative estimate of the non agricultural land.

Rent for the use of the land cannot be less than the tax rate. Now, according to the Tax Code, this rule applies only to agricultural land and other land cannot be leased for less than three times the amount of land tax. All these changes are aimed at increasing local budget revenues state the materials of Finance Ministry. In 2012, it received about 11.7 billion UAH of land tax.

At the same time, the Finance Ministry proposes to deprive space, vessel, aircraft, and film industries of benefits on payment of land tax that were in effect until 2015-2016.


 
 
 
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