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Law on single account for payment of taxes and fees came into force

Source : 112 Ukraine

The law should solve technical problems during the transfer of these payments
14:38, 18 April 2020

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In Ukraine, the law on a single account for the payment of taxes and fees came into force. The purpose of this law is to create a single account for the payments, which should solve many technical problems during the transfer of taxes and fees, optimize the work of tax authorities and simplify the life of the business.

The parliament adopted this law in the second reading and as a whole on October 4 of last year. But Ukrainian President Volodymyr Zelensky vetoed it since the 8th amendment of this document caused considerable indignation among manufacturers of the tobacco industry, because of which they even stopped production at several factories. As a result, the underfulfillment of the excise tax collection plan amounted to about 3 billion UAH (almost 108 million USD).

Related: Taxes for Ukrainians with small salaries to be reduced

The president proposed removing this margin adjustment amendment for wholesale and retail cigarette companies. Accordingly, the Rada supported this proposal.

The Verkhovna Rada adopted the relevant law with the proposals of the President on April 13 with 279 votes of the MPs.

Earlier Verkhovna Rada adopted bill No. 1210, better known as the bill “On Tax Terror”, in the second reading and as a whole. The law is one of the worst in eight years, stated MP of Ukraine, member of the parliamentary committee on finance, tax and customs policy Nina Yuzhanina on her Facebook page.

"During the work on the bill, the relevant committee took into account many amendments, but the global amendments that could prevent an adverse effect on the business were rejected," Yuzhanina writes.

Among the key innovations: the right of tax officials to “adjust” the financial result of the enterprise in order to increase tax payments, the norms on the extra charge of 18% tax on profits of IT companies abroad, the increase in rents for gas and ore production, and discrimination of foreign investors due to taxation of exchange rate difference.

Tax authorities will receive additional rights to increase tax payments to exporters at the expense of the so-called "business purpose rule", which can significantly affect Ukrainian exports, including to EU countries.

Tax fines for businesses will increase dramatically (in 4 times for many positions). At the same time, the inspectors of the State Tax Service will be removed from liability for illegally accrued tax payments and fines.

"The powers of the State Tax Service are being unreasonably expanded - uncontrollably, without a strategy. At the same time some regulations are being taken out on the sly by the State Tax Service representatives and suggested to MPs," describes Yuzhanina the process of the bill adoption.

Related: Customs, Tax Services to work in new format in Ukraine

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