Moldova & IMF IMF Activities Publications Press Releases

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The International Monetary Fund (IMF) does not expect new negotiations with the Government of Moldova on the increase of VAT on sugar that will come into force in 2012. In an interview with your Infotag correspondent, the IMF Resident Representative in Moldova, Tokhir Mirzoev, has said that “tax policy issues were discussed within the visit of a Fund’s assessment mission to Chisinau in May”. “In the middle of July, it is expected a meeting of the IMF’s Board of Governors on considering the 3rd review of the Moldova’s program with the IMF, including the policy measures coordinated in May”, Mirzoev said. According to the IMF representative, main discussions of IMF experts with the Government on the sugar VAT increase to 20% from 8% in 2012 were held within the Fund’s mission visit. “One does not expect changes of agreements in this respect at this stage. Such discussions are usually held in the context of IMF’s assessment mission visits”, Mirzoev said. The IMF Resident Representative in Moldova said the Fund has a firm agreement with the Government on the sugar VAT be increased to 20% in 2012, and that beginning next year the state will pay back VAT on equipment and technologies in the form of investment. Infotag’s dossier: The beet sugar VAT increase to 20% from 8% is established in the Moldovan draft tax policy for 2012-2014. The Ministry of Finance (MoF) justifies the tax increase by the necessity to follow the IMF guidelines on VAT rate unification, as well as aspiration to build up tax incomes to the Budget. The MoF amounts the tax increase from 20% VAT in 101 million lei. Sugar beet sector specialists and experts say the sum is overrated for 2 times and that budgetary revenues will go up only 30-40 million lei. Last week, Prime Minister Vladimir Filat created a work group, including all interested parties, which targets to develop strong arguments for later negotiations of the Government with the IMF.