Agricultural Leaders Urge Tax and Duty Reforms to Prevent Collapse of Ukraine’s Food Security

Ukrainian Agribusiness Club CEO Oleh Khomenko calls for urgent tax and tariff reforms to save the agricultural sector from an energy and logistics crisis.

By: AXL Media

Published: Apr 18, 2026, 5:54 AM EDT

Source: Information for this report was sourced from Interfax-Ukraine

Urgent Call for Indirect State Support

The survival of Ukraine's agricultural sector is currently at a critical juncture, prompting the Ukrainian Agribusiness Club (UCAB) to demand immediate structural reforms. During a recent economic review hosted by the Centre for Economic Strategy (CES), UCAB CEO Oleh Khomenko outlined a three-pronged survival plan focused on tax relief, trade liberalization, and logistical transparency. Khomenko emphasized that the agricultural sector, traditionally the backbone of the national economy, is being hollowed out by a combination of high operational costs and a lack of the indirect supports commonly found in neighboring European nations.

Fuel Tax Disparity with the European Union

A primary point of contention is the current fuel excise tax, which Khomenko identified as one of the highest in Europe. While many European Union member states provide a zero-rate tax on fuel specifically for farmers to ensure food security, Ukrainian producers are paying full rates during an unprecedented energy crisis. Khomenko acknowledged the significant national budget deficit and obligations to international partners but argued that reducing the tax burden on agricultural fuel is a necessary defensive measure. Without this relief, the rising cost of field operations threatens to make the upcoming harvest financially unviable for many small and medium-sized enterprises.

The Fertilizer Crisis and Import Duty Abolition

The domestic fertilizer market is currently facing a massive supply gap, with Ukrainian plants producing only 1 million tonnes against a national consumption requirement of 4 million tonnes. This shortfall forces farmers to rely heavily on imports, which must be purchased in foreign currency at prices inflated by high global gas rates. UCAB is proposing the total abolition of the current 5% import duty on fertilizers to mitigate these costs. While seemingly a small percentage, Khomenko noted that such a step would serve as vital compensation for the "extremely difficult" conditions facing agribusinesses, helping to lower the overall cost of production for essential food crops.