The animal breeder will loose on VAT reduction

The VAT reduction on living and half-pigs to 5 percent – despite the intentions and declarations – will not provide a meaningful solution against the black economy and will not cause a consumer price decrease either, as consumers will continue to pay a 27 percent VAT, but the step will further worsen the position of the pig farmers, that have significant income deficit already – the communication of MOSZ states.

While the producers, among other things, have to pay the 27 percent VAT after the purchased compound feeds, and veterinary drugs – as the result of action – they will have only 5 percent gross revenues after their sold pigs. Consequently, the pig farmers will be forced into a VAT reclaimant position, which in practice means that they will finance the food industry and the state temporarily. In order to do this they have to take out a loan – so far as the banks are willing to lend to them – and the burden of interest should also be borne by them. (by our colleague)