Ukranian Ministers Discuss Tax Laws

by Tatiana Smolenskaya, Tax-News.com, Moscow

26 January 2009

The Ukrainian Vice Prime Minister Olexandr Turchynov met with Finance and Economics Minister Viktor Pynzenyk and other government officials to discuss amendments to local tax legislation last week.

Participants of the meeting discussed the progress of a recently formed working group, comprised of high-level officials and heads of municipal councils, who were allocated the job of concluding discussions into possible amendments to tax laws involving municipalities. The government has this week announced that the working group has made significant progress in formulating amendments, including the forms of taxation and specifying rates. The group will now work on finalising discussions and ultimately formulating a draft law to be tabled in Parliament.

Turchynov suggested that the tax burden should be significantly reduced for small enterprises and also discussed the simplification of the Ukrainian tax system to reduce tax evasion, stating: “[The working group] will help provide an improved and simplified tax system, which will reduce the tax burden on small businesses and implement legislation to deter tax evasion."

Tax evasion is a growing problem on a national level, with the government losing billions in unpaid taxes every month, particularly value-added tax.

Concluding the meeting Turchynov urged heads of departments to work in constant dialogue with the local councils and entrepreneurs to achieve conclusive multilateral decisions. A statement dated January 21, announced that 448 (64%) of local councils had submitted finalised drafts of their 2009 budget.

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