November 4, 2008
Ukraine's Agricultural Policy Ministry has proposed that meat imports on a tolling basis should be banned.
The proposal is meant to boost domestic meat output while increasing employment in the countryside.
Last April, the government banned give-and-take meat deliveries until September 1, 2007, but the ban was extended to April 1, 2008 from November last year.
From January to September this year, Ukraine imported 366,000 tonnes of meat and byproducts, up 2.3 times on-year. About 58,100 tonnes of meat worth US$91 million was imported on a tolling basis.
Companies importing tolling raw meat are evading taxes through declaration of low output of finished products after processing, said the agricultural policy ministry.
As a result, the national budget has incurred heavy losses from unpaid duties and understated import prices, which is destabilising the domestic market more than ever under the current difficult conditions, the ministry said.
Purchase of imported raw material without paying taxes leads to domestic price falls, making husbandry production ineffective and creates unfair competition between domestic producers and importers, the ministry said.
According to the UkrMiasoProdukt, the shadow sector of meat industry covers from 40-50 percent of the market, and the price difference is 35 percent in favour of imports.