ADVANTAGES AND DRAWBACKS OF THE NEW METHODS OF NORMATIVE MONETARY VALUATION OF AGRICULTURAL LANDS

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Visnyk LNAU: Architecture and Farm Building 2019 №20: 116-120

ADVANTAGES AND DRAWBACKS OF THE NEW METHODS OF NORMATIVE MONETARY VALUATION OF AGRICULTURAL LANDS

О. Mykula, PhD Т. Susak, Post-graduate Student Lviv National Agrarian University

https://doi.org/10.31734/architecture2019.20.116

Annotation

The article argues the necessity to make analysis of the principal advantages and drawbacks of introduction of a new approach to performance of normative monetary valuation of agricultural lands in Ukraine in terms how it has corrected the drawbacks of the previous one, and how it will contribute to the following development of lease relations and establishment of a land market. The research names domestic scientists, who have studied the problem, and confirms the fact that there is no deep analysis of possible consequences of those methods introduction in Ukraine, as well as their impact on land relations. The issue has become the topic of the current research.

The authors of the article present a retrospective analysis of the methods and procedure of performance of the normative monetary valuation of agricultural lands starting from the methods of 1995, which were based on the data of economic evaluation of the land of collective farms in the Ukrainian SSR (1988), according to the results of their economic activity in 1981–1987, as well as on the statistical data concerning efficiency of agricultural production in the period of 1986–1990.

Numerous attempts to update the indices of that assessment have not considered its methodic aspects and mainly concerned peculiarities of indexation. It has become the reason for numerous publications, which are devoted to examination of drawbacks of those methods.

On November 16, 2016, the Cabinet of Ministers of Ukraine passed the Resolution № 831 «About approval of the Methods of normative monetary valuation of agricultural lands» [10] (hereafter methods of 2016) to eliminate the drawbacks. The Resolution adopted new methods, making a basis for performance of national (Ukrainian) normative monetary valuation of agricultural lands. Moreover, results of the analysis of drawbacks of old methods and advantages of the new ones are considered doubtful.

Transition to the new methods does not sufficiently improve the system of taxation and lease relations (reduces a minimum size of lease payment for land parcels (shares) for a great number of their owners), requires additional budget costs for their performance.

Moreover, the analysis demonstrates that the relation with the results of previous valuation has been lost, and the situation has become totally unclear for the owners of land parcels. How can the reduction of normative monetary valuation of their property be reasonably argued under conditions of hryvnia devaluation and increase of prices for food? The issue is both economic and political one.

The work outlines scientific and methodic approaches to normative monetary valuation of agricultural lands, and supplies a comparative analysis of the methods of normative monetary valuation of agricultural lands of 1995 and the current ones. The analysis suggests a conclusion that the Methods of 1995, regardless of insufficient drawbacks, can perform their legally approved functions in the future, but with little corrections. The new methods have poor argumentation. Hence, it is necessary to make further improvement of theoretical and methodological fundamentals for the normative monetary valuation of agricultural lands and update their legal support.

Key words

normative monetary valuation, agricultural lands

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