Tajik authorities are currently considering the possibility of restoring tax benefits for domestic millers and flour suppliers, according to the Tax Committee under the Government of Tajikistan.
An official source at the Tax Committee says the tax benefits for domestic mills and flour suppliers were cancelled at the beginning of this year, and after that, the price for wheat flour rose nearly 5 percent during January.
“Taking into consideration proposals from flour producers, the Ministry of Finance has worked out a bill requiring amendments to the national budget for 2019. The bill, in particular, proposes to set the rate of value added tax (VAT) for wheat delivered to the country for flour-grinding enterprises at 10 percent. The same VAT rate is proposed for sale of products of the flour-grinding enterprises,” the source said.
According to him, the bill has been sent for consideration to the Government.
Cancellation of tax benefits for millers and flour suppliers reportedly resulted in flour prices rising 4.6 percent in January.
According to the official statistical data, the price for one kilogram of grade I wheat flour rose from 3.43 somoni in late December to 3.59 somoni in late January.
Tajik central bank says the price hike resulted from internal and external factors, including the rising cost of wheat in exporter countries.
Besides, Tajikistan last year reduced production of wheat by 14.6 percent compared to 2017, according to the National Bank of Tajikistan (NBT).
Meanwhile, wheat imports have decreased and flour imports have increased.
According to the Agency for Statistics under the Government of Tajikistan, Tajikistan has imported 89,500 tons of wheat over the first month of this year, which was 2.3 percent fewer than in the same period last year.
Over the report period, Tajikistan has imported 3,075 tons of wheat flour, which was 16.5 percent more than in the same period last year.
Kazakhstan provides the bulk of Tajikistan’s wheat and flour imports accounting for more than 90 percent of wheat and flour being delivered to Tajikistan.
Tajikistan annual requirements in wheat flour are 800,000 tons.
