Kazakh farmers driven “into a flock”

“Joining into cooperatives – is some kind of a shady deal with the purpose to drive small agricultural producers “into a flock”. It is not clear, whether our officials are doing this by their stupidity or as they have some sort of evil intent “- say the farmers, who puzzled out in detail the initiative of the Ministry of Agriculture to establish a network of AC in Kazakhstan.

Work without fringe benefits

Recall, the Ministry of Agriculture plans to unite 670 thousand small agricultural producers into 1584 agricultural cooperatives during five years of the new agro-industrial complex development program.

The emphasis is on small-scale agricultural producers – private farms (LPH), and also of farms (PFs and PC). That is, those who either do not pay taxes or pay them simplified tax (3% of the profits + 10% pension contributions), or enjoy a special tax regime, implying a 70 per cent rebate.

And how the AC will pay taxes? The Ministry of Agriculture of RK uncertainly hinted at possible concessions to cooperatives. But the promise of a tax return will not sew. Especially since the Ministry of Finance is now a completely different task – to ensure filling of the budget, which is already suffering due to the crisis.

Law of the Republic of Kazakhstan dated 29.10.15g. №373-V «On introducing amendments and addenda to some legislative acts of Kazakhstan on the issues of agricultural cooperation”, or peasant farmers have the right to the use of CHP (special tax regime) for agricultural producers with 70% -s tax carried forward when under certain conditions. The condition is – exemption applies only to the person having land.

In the land of the cooperative is not because it is bringing people together. So, he will pay taxes in full.

How much is it? According to World Bank estimates, is a ranking of countries «Doing business», in 2015 the tax burden ratio was 29.2% in Kazakhstan. This total tax rate, which shows the amount of taxes and mandatory contributions to be paid by the company for the second year of operation, expressed as a percentage of commercial profits, says the correspondent of “KazakhZerno.kz” edition.

That is, the AC will be forced only in the form of taxes to give a third of their income!

Profit will be cut by one-third

Do they understand the peasants themselves, what to expect? Looks like no. Otherwise, how to explain their interest in the program “Bereke”, which at the end of the year quickly “sucked” the villagers across the country Fund for Financial Support of Agriculture (FFSA), part of the National Holding “KazAgro”.

The official sign “KazAgro” and its numerous subsidiaries, we all remember – support for farmers across the country concessional financing. In reality, this is ugly shaped design degenerated into a monster, preying on the peasant labor. No wonder the president of RK charged to reform the holding. But officials instructed Elbasy buried under a pile of new “Napoleonic” plans. Including – he plays the role of “zavlekalochki” to unite peasants into cooperatives.

In “Bereke” program all the same as always, “KazAgro”: almost get free money from the government, the villagers have already issued credit at 6% per annum. It is necessary for something to live accustomed to the luxury of “financiers”.

The amount of credit to 4 million tenge, the term – up to 54 months. Purpose of funding – purchase of young cattle for fattening beef breeds, or purchase cows for milk production.

However, just contact the FFSA and get a loan was not possible. The Foundation has set the villagers condition – first register as individual entrepreneurs (SP), and after another and unite in the SCC. The first cooperatives were formed in the country in the five villages of the Karaganda region. And 115 participants received FFSA loans totaling $ 278 million. Tenge. While they are happy to have received the opportunity to lent. But is it profitable conditions?

The fact is that before the unification of all the villagers work as smallholders and do not bear any tax burden. And now, in addition to the 6% loan, they will pay 10% of the pension and give a third of the profit on AC taxes. Credit is obtained “gold”.

The question arises: why the villagers in terms of lending needed to make the creation and association of IP in the AC? In the FFSA note that two reasons. First, the Ministry of Agriculture of the Republic of Kazakhstan is seeking speakers in the creation of cooperatives, and uses as a tool to attract “lgonoe” lending. Secondly, the Fund itself is necessary statements that their activities have led to an increase in employment in rural areas. And if smallholders are not converted to IP, a beautiful picture will not work.

As you can see, both reasons are irrelevant to the interests of the farmers themselves.

How to grasp the immensity

Another problem is the creation of the AC – a condition that can unite at least 20 farms. Farmers talk about the need to reduce this number. Otherwise, the process looks like an attempt to grasp the immensity.

– Cooperative has to be a union of like-minded people. Otherwise, he will not be able to work effectively. And where to find 20 people who share the same point of view and trust each other? This is unrealistic. As a result, inevitably there will be problems that will affect everyone. Optimally, it would allow the combined 10 farms – said the experienced farmers.

The issue of trust is important because members of the SCC shall be jointly liable. And if anyone has any problems, they will affect all. Elementary, someone takes a loan and cannot pay. To pay the debt will have the rest.

The way it works, the peasants themselves are well on the experience of SCT – rural credit associations. They are also part of joint and several liability. If one of the members of the SCT have problems with payments – fully closes credit line. This happens very often, especially in the spring is bad when people need money for planting. But due to the problems of all remain oborotki.

Sometimes even more difficult – someone from the members of the SCT is arrested for the debts of the property. Including – arrest prick on his share of the SCT. In this case, too, the entire line is closed and the other members of the partnership are suffering. Re-register is not possible for someone to release or take – too it is impossible, because the share of a member in custody. And the same is transferred to cooperatives.

– Of course, it may be, over time, all we have to hone, – says agrarian. – I was in Canada, where the largest cooperative brings together 2800 participants. They open a separate line of funding under 2%, they built themselves a heap of grain receiving points. What mostly they want this cooperative? Grain is sold at the same price and a pool. We have a major problem in this – every director himself. One more sell one for less. We are each other that interfere. And there is one price – and everything is clear. If we did so, it will be no miller of us still here – would take the grain to our conditions.

But it is a matter of the future. In the meantime, the law on agricultural cooperation is very crude, many other laws (including tax) needs to be expanded to facilitate the creation of cooperatives. And while this is not done, the process of creating the SCC will go very hard and very unproductive.

Sergey Buyanov

“KazakhZerno.kz” newspaper

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