December 21, 2020

Covering part of the costs (benefits) for introducing water-saving technologies in agriculture

In the past two years, special attention has been paid to the introduction of water-saving technologies in the cultivation of agricultural crops. As a result of state support, only in 2020 water-saving technologies were introduced additionally on an area of 133 thousand hectares.

However, the demand for water resources is only increasing across the country. For this reason, the Decree of the President of the Republic of Uzbekistan dated December 11, 2020, No. 4919 “On measures to further accelerate the organization of the introduction of water-saving technologies in agriculture” was adopted.

According to this Resolution, starting from 2021state support for the introduction of water-saving technologies in the cultivation of agricultural crops will be provided as:

  • subsidies for agricultural producers to cover part of the cost for introducing water-saving technologies;
  • covering part of interest on bank loans allocated for the purchase and construction of water-saving technologies;
  • 30 percent covering of cost from the State budget to agricultural producers for purchasing automated land-planning units with a laser device produced by domestic producers.

Subsidies are allocated with the condition that the introduced water-saving technologies are applied for at least five years. At the same time, it is planned to form subsidies in the amount of 1.5 trillion soums (approximately USD 143 362 000at exchange rate for December 21, 2020) necessary to support the introduction of water-saving technologies in 2021.

However, if the water-saving technologies introduced at the expense of subsidies allocated from the State budget are not used in the prescribed manner and within a certain time frame, it is envisaged to return the subsidized funds and cancel the applied tax benefits. It is also envisaged to stimulate the introduction of public control mechanisms, in particular, incentives in the amount of up to five percent of the returned subsidized funds to persons who have sent photographs and videos confirming the facts of non-use in the prescribed manner of water-saving technologies introduced through subsidies allocated from the State budget.

The amount of subsidies allocated to cover part of the cost of introducing water-saving technologies (except for laser alignment) is determined by multiplying their basic calculated value (established by this Resolution) by a coefficient determined based on their quality level.

Follow the link to learn more about tax and customs benefits.