DUSHANBE, October 31, 2008, Asia-Plus — The government intends to exempt Tajik-Iranian joint tractor-assembling venture, TojIron, from paying some taxes next year, Finance Minister Safarali Najmuddinov announced at an enlarged meeting of the Majlisi Namoyandagon (Tajikistan’s lower chamber of parliament) Committee on Economy, Budget, Finance and Taxes on October 30.
“Under conditions when our farmers cannot afford to purchase expensive agricultural machines from abroad, it will allow lowering prices of tractors and other agricultural machines assembled at TojIron,” the minister said, noting that the joint venture will pay social and insurance taxes.
We will recall that according to the TojIron top managers, the current price of a tractor assembled at JV TojIron is $17,500.
As it had been reported earlier, by government’s resolution of February 6 2008 on making amendments to the resolution on the country’s budget for 2008 spare parts imported into the country for production of tractors and other agricultural machines are exempted from a 20 percent value added tax (VAT) and 5 percent customs duties.
TojIron started operating with the capital of $10 million in September 2006 but failed to bear fruits due to lack of financial support as well as red tapes in importing tractor parts from Iran. The enterprise has the capacity to assemble up to 2,000 tractors a year. The plant will mainly supply Tajik farmers. However, they also plan to export their tractors to Central Asian countries and Afghanistan.
TojIron was created by an agreement between Tajik industries minister and the Iranian ambassador to Tajikistan in Dushanbe in June 2006. Under the agreement Tajikistan owns 49 percent of the shares and Iran holds a 51% ownership interest in the company.
