A quarter of the Ukrainian sunflower market is in the shadow, AgroPortal reports, referring to the data of Pavel Koval, general director of the Ukrainian Agrarian Confederation.

The expert explains this by the fact that a significant part of the land, particularly under this crop, is in an illegal situation.

For the analysts, it was easy to calculate the black market share of sunflower, the volume of oil that Ukraine exports does not correspond to the officially produced sunflower.

25% of the shadow market, according to Koval, creates inappropriate competition for companies operating in the “white” market and also leads to an imbalance related to the VAT.

“When we appeal to the Verkhovna Rada and the State Fiscal Service of Ukraine with the initiative to revise the tax policy in the segment of agricultural products, to reduce VAT on individual products from 20%, for example, to 10%, we get a weighty argument from them – manufacturers work in the shadow”, tells Koval.

Another argument of the fiscal service is: in the case of VAT reduction, the budget will suffer significant losses and there is nothing to compensate for them.

According to analysts, with a decrease in the VAT to 10% in any of the segments of agricultural production, the state budget may lose UAH 22-23 billion.

The Confederation understands that in a short time it is impossible to remove the entire agrarian business from the shadows, but an adequate tax policy may gradually establish this process.