The 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.
When considering the bill, Oleksiy Honcharenko, MP of Ukraine, addressed to the Speaker of the Parliament with a statement on violation of the Regulation.
"The consideration of this document is in violation of the requirements of Article 117 of the Regulation of the Verkhovna Rada, according to which the bill prepared for the second or repeated second reading, the conclusion of the main committee and other supporting documents to it are submitted to the members of Parliament no later than 10 days before the day of its consideration in plenary meeting of the Parliament," Honcharenko said.
According to him, the MPs should have received the document no later than January 6, but they have received it only this morning, so they could not get prepared, because "a thousand pages of amendments, 269,000 words have been submitted to the bill."
By the second reading, 2219 amendments were received, 1174 of which were taken into account, and 1045 were rejected. In general, according to economists, bill No. 1210 may cost Ukraine about 1% of the country's GDP, that is, about 36-37 billion UAH, the media say.
"It is worth noting that all the main business associations and associations of foreign investors of Ukraine categorically opposed this bill, including the European Business Association, the American Chamber of Commerce, the Ukrainian Union of Industrialists and Entrepreneurs, the Federation of Employers of Ukraine and many others," journalists write.
The Council of Entrepreneurs under the Cabinet of Ministers of Ukraine called bill No. 1210 "tax terror."
"Let us recall, exactly 6 years ago – on January 16, 2014 – the Parliament of Ukraine, under the influence of the Party of Regions and in violation of the Verkhovna Rada Regulation, adopted scandalous laws restricting the rights and freedoms of citizens of Ukraine, including the holding of mass events, as well as the media rights. Laws led to mass protests and were canceled in February 2014," the article says.