Mazhilis deputies declare unacceptability of utilization fee for agricultural machinery in Kazakhstan

Judging by the activity in social networks, the topic of introduction of utilization fee for agricultural machinery in Kazakhstan does not cease to subsidize, and even, on the contrary, not only people who are involved in agriculture, but also non-core experts, as well as ordinary citizens are engaged in discussion of this issue.

Recently, many public people have been speaking on this subject. Take at least the recent post of the Deputy Chairman of the Board of "Atameken" NPP Yeldar Zhumagaziyev on Facebook, in which he said that the utilization fee should be cancelled. It is noteworthy, that many Kazakhstani ecologists are in favor of this as well. 

It should be noted that even before the entry into force of the order of the Ministry of Ecology of June 17 on the introduction of utilization fee the leaders of almost all associations in the field of agriculture, representatives of "Atameken" and many public associations, as well as members of the Majilis of the Parliament tried to oppose this initiative on behalf of ordinary farmers.

The editors of the portal World of Nan received a request from a group of mazhilis deputies to the Prime Minister Askar Mamin, which indicated the strong position of mazhilismen on this issue, and also explained in detail the unacceptability of such a measure.

Thus, in their request, the deputies recalled that, despite the negative opinion of the agricultural associations and business community, at the end of 2019 a partial utilization fee for imported equipment, assembly production of which already exists in our country was already introduced. Now the fee has been extended to other types of machinery.

"This goes against the interests of agricultural associations, as well as, in our opinion, contradicts the instructions of the leadership of our country to increase productivity by 2.5 times in the agricultural sector. We believe that in today's conditions, when the amortization of agricultural machinery reaches 80%, the introduction of utilization fee will cause a serious blow to agriculture and the economy of Kazakhstan, as well as irreparable damage to farmers, depriving them of access to modern high-performance agricultural machinery," the text of the request says.

As an example it was stated that in the structure of wheat production the share of agricultural enterprises, mainly operating in the form of LLP, accounts for up to 68% of the gross harvest. The majority of such agricultural enterprises use modern agro-technologies aimed at increasing labour productivity, use high-performance equipment from distant foreign countries.

According to the deputies, the decision on introduction of utilization fee will first of all have a negative impact on the renewal rates of this particular category of producers. Although they are the basis for diversification of production, as they expand the range and volume of products (peas, lentils, rapeseed, mustard, flax, etc.).

"At the same time, there is no need to talk about the fact that the domestic machine-building industry will get some powerful push from the innovation. As a matter of fact, introduction of utilization fee is just lobbying of interests of beneficiaries of this measure represented by several assembly plants in RK. Unfortunately, their current and future assortment, as well as the quality of produced machinery are unable to meet the needs of the country's agrarians in modern productive agricultural machinery today. Introduction of utilization fee will lead to a simple price increase of machinery", - the deputies note.

Mazhilismen also touched upon the objective of the Ministry of Ecology - to encourage farmers to turn in their used machinery for processing by introducing a utilization fee.

"Common sense suggests that farmers do not do this because they cannot afford to buy new machines. So they prefer to patch up the old ones. It is not clear how this "problem" can be solved by introducing a utilization fee, which will automatically raise the cost of new equipment by another 10-30%", - emphasize deputies.

The request also notes that for six months (since the introduction of the "first" utilization fee) 500 units of agricultural machinery were planned to be collected for utilization, and then another 1000 units. "However, more than six months have passed, but not a single agricultural machine, we are sure, has been disposed of and recycled, as there is no infrastructure for this. It follows from this that this measure is subject to cancellation due to failure to achieve the goals," concluded the MPs.

Considering the above, the mazhilismen proposed to abandon the expansion of utilization and to review the coefficients applied to the basic rate of utilization of agricultural machinery. In addition, the deputies proposed to review measures to support the domestic component assembly of agricultural machinery, taking into account the existing programs of development institutions, but with strict control over the compliance of the plants with their commitments on the localization of products and the level of local content.