Unprocessed Agricultural Products

Unprocessed Agricultural Products

Unprocessed agricultural products are non-taxable supply ( VAT exemption).

The Ministry of Economy and Finance (MEF) has issued a Prakas 495 dated 6 April 2016 to provide the VAT exemption on the sale of unprocessed agricultural products like grains including paddy rice by registered taxpayers. The term “unprocessed agricultural products” refers to bulbs, flowers, leaves, shoots or suckers, roots, and miscellaneous plant elements which have been obtained from local cultivated land, whether sliced or grounded or not, which has not been processed to create a final product.

This Prakas gives additional VAT exemptions to the Prakas 312 dated 19 March 2014 for VAT exemption
on importation and local supply of agriculture equipment and products. Moreover, the registered taxpayer
could claim the input VAT on the local purchase in accordance with the article 29 to 41 of VAT sub decree
114 dated 24 December 1999.