Show the farmer and support the trader.

It has been reported that the good news of the discounted Special Consumption Tax (SCT) given by President Recep Tayyip Erdoğan to Adıyaman tobacco farmers, who fell into difficulties during the earthquake, will not directly benefit the farmers, and that the real income from the discount will come from tobacco dealers. Instead of a tax cut, it was proposed to give additional government support to the price of farmer-produced leaf tobacco. During his visit to the earthquake zone, President Erdoğan said: “We are halving the SCT rate of 55 percent on the sale of cut tobacco. Our producers will have the opportunity to market their products in a more advantageous way than the companies. The regulation will be implemented in a few days,” he said.

THE LEAF PRODUCES TOBACCO

Gökhan Ersöz, former president of the Non-Smoking Tobacco Manufacturers Association, said the farmer produces leaf tobacco directly, not shredded, and leaf tobacco is not subject to the SCT. Stating that it is not possible to support the farmer with SCT reduction, Ersöz said: “The farmer produces leaf tobacco and sells it in bales to the cooperative or tobacco processing companies. No excise taxes are paid during this sale. This farmer-sold tobacco is processed by the companies, turned into rolled and packaged shredded tobacco, then the 55 percent SCT comes into play. If the Special Consumption Tax on this product is reduced from 55 percent to 27.5 percent, those who process and sell the farmer’s tobacco and those who do the trade will make a profit if they do not reduce the price at that rate. A small amount of this income may go to the member farmer of the cooperative indirectly. If they reflect the discount in the price, the consumer will win, but the producer will not win again, ”he said.

gokhan ersoz

The farmer must be supported with a head price

Gökhan Öz suggested that the tobacco farmer, which was damaged by the earthquake, should receive preferential price support. Stating that the state-supported headline price can be applied to producers affected by the earthquake, Öze said: “The state can provide unique price support for farmer-produced leaf tobacco. Thus, the money goes directly into the farmer’s pocket. The support would not have gone to others, ”he said. It is claimed that the tax reduction proposal has been on the agenda before, but the Ministry of Finance rejected these demands, considering that it would not be useful for the farmer.

Affected 57 thousand tobacco growers

While the number of tobacco-producing farmers in Turkey is 57,000, the total production amount is 82,791 tons in an area of ​​950,000 decares, according to 2020 data. The eastern and southeastern Anatolian regions affected by earthquake represent 29% of total tobacco production, while the Mediterranean region has a share of 1%.