Domestic
Imported Rice: Madagascar Bets on Local Production with New Tax Policy
The Malagasy government is shifting its rice policy strategy. Luxury imported rice is now subject to a 20% customs duty and 5% VAT, in line with the 2026 Amended Finance Law. This measure, integrated into the upcoming Economic Recovery Plan, aims to rebalance a market increasingly dominated by imports while strengthening the competitiveness of the domestic sector. Authorities stress this is not about halting imports, still considered necessary to supplement available supply, but rather curbing a concerning dependency. Nearly 800,000 tonnes of rice enter the country annually. In the first six months of 2026 alone, over 408,000 tonnes were imported, with the vast majority being premium rice. Meanwhile, many local producers struggle to sell their harvests against foreign competition that pressures prices. This new taxation raises concerns among some consumers worried about higher costs for this rice category. However, the government defends a long-term strategy, arguing that supporting domestic production is essential for achieving food self-sufficiency and preserving foreign currency reserves. The reform includes several measures to improve production conditions. Herbicides and fungicides now benefit from tax exemptions, while fertilizers and agricultural equipment already enjoy relief. Simultaneously, the state continues rehabilitating dams, expanding irrigation networks, distributing improved seeds, providing technical support to farmers, and developing road infrastructure to facilitate harvest transportation. Early indicators show progress in domestic production. Official estimates value the 2026 paddy harvest at 5.172 million tonnes, up from 4.684 million the previous year. The Sofia region remains the leading rice basin with production exceeding 700,000 tonnes. In several rural areas, this increase already allows some producers to market rice beyond their communes and improve household incomes. Through this approach, the executive aims to restore Malagasy rice to the center of national consumption. The stated ambition is to sustainably strengthen the sector, support agricultural incomes, create more rural jobs, and progressively reduce the country's dependence on food imports.
Source: Madagascar Tribune