Uzbekistan, Tashkent, Aug. 12 / Trend D.Azizov /
In Uzbekistan the rate of excise duty on wheat flour imported into the country has been reduced from 15 to 11 per cent of the customs value in accordance with a special presidential decree published in the electronic media in Uzbekistan on Monday.
According to the document, lowering the excise duty on the import of flour is undertaken 'in order to further streamline the import of wheat flour and create conditions for expanding the range of bakery and confectionery products produced by domestic enterprises'.
A 15 per cent excise tax on flour was introduced in late 2012 by the decree 'On the forecast of key macroeconomic indicators and parameters of the state budget of the Republic of Uzbekistan for 2013'. Kazakhstan is the main supplier of flour to Uzbekistan.
According to the Kazakh side, it supplied 1.216 million tons of flour to Uzbekistan in the first half of last year, while 709,000 tons (a 45 per cent decrease) were supplied over the same period this year due to higher excise tax.
Increasing excise taxes leads to a downtime of almost a quarter of the Kazakh mills, as exports to Uzbekistan constitute 75 per cent of Kazakhstan's grain exports.
In July, the Minister of Industry and New Technologies of Kazakhstan Asset Issekeshev suggested that the Government of Kazakhstan introduces 'mirror' measures against countries using high excise taxes on Kazakh products including raising tariffs on imports from Uzbekistan.
Domestic demand for wheat in Uzbekistan with a population of 30 million exceeds four million tons, while including insurance reserves stand at five million tons.
As reported, cereal production in Uzbekistan in 2013 stood at 7.61 million tons compared to 7.17 million tons a year earlier.
Due to climatic conditions hard wheat varieties needed for bakery, confectionery and pasta are not grown in Uzbekistan and the need for these type of products is covered through imports.