Sofia now has green light for the reduction of excise duty on fuel for agricultural use. European Commission gave its approval at the end of 2011. According to documents issued by the Comission this is a duty bonus of BGN70 million, but only for 2012. It affects all farmers. From this kind of assistance can benefit farmers and growers of fruits and vegetables. According to experts from the State Aid Department at the Ministry of Agriculture such funds have been entered in the budget as a reduction in its revenue. The relevant regulations came into force in early January. Farmers and breeders will benefit from this incentive through vouchers that will be distributed.
The new State aid scheme acting through reduced excise duty on fuel used in agriculture, is open to all farmers of primary agricultural production. The assistance is provided to actually consumed in the process gasoil and represents a reduction of the excise duty on this fuel, i.e. farmers will pay less for it.
This is expected to have a beneficial and stimulating effect on the agricultural sector as the lower excise duty would reduce costs to farmers in agricultural production. The implementation of the scheme will enhance the competitiveness of the sector on both domestic and international markets. In addition, lower production costs, in case all other conditions are equal, will affect the final prices of agricultural products and will be a prerequisite for reducing them, which would have a positive effect on end users.
Grant aid will be in two stages to facilitate farmers who are thus able to secure regular supplies of fuel. At each stage, the approved farmers will receive vouchers for fuel. They will have the right to buy gas from stations with reduced excise duty or get fuel for free equal to the amount of aid they are entitled to. Vouchers are used only for obtaining gasoil, measured in litres. Vouchers are not exchanged for cash, i.e, they cannot be bought or sold. In case of their unlawful use fines and penalties will be imposed.
Applications for such assistance will be by submission of declarations in the regional Agriculture directorates at the Ministry of Agriculture and Foods.
Right to fuel vouchers have registered farmers who have no outstanding public obligations and are not in bankruptcy procedure, have not been declared bankrupt, are not in liquidation and do not fall within the category of firms in difficulty. Farmers who are found to have breached the terms of use of fuel vouchers will not be entitled to apply for fuel vouchers in the next two years.
According to Agriculture Minister, Miroslav Naydenov the entry into force of the notification, those who benefit from the scheme of State aid will only pay only 18 cents per litre of fuel in excise duty.
