Oleksiy Lyubchenko: high indicators of budget revenues are the result of joint successful work of taxpayers and tax specialists
According to operative data, the general fund of state budget received 387.3 billion UAH of payments controlled by the State Tax Service during January – September 2020. This is 56.2 billion UAH or 17% more than during the corresponding period in 2019.
Revenues for 9 months of 2020 exceeded expectations by 26.4 billion UAH.
“In May – September, the State Tax Service not only made up for the lag made in January – April totaling 11.7 billion UAH but also achieved a significant over-fulfillment of indicator for January – September by 26.4 billion UAH” – stated Oleksiy Lyubchenko.
According to him, the growth rate of total revenues from payments controlled by the STS for 9 months of 2020 is +11% with a reduction in GDP (according to the Ministry of Economy) by 6.7% during the 1st half of 2020.
“Such high indicators are the result of joint successful work of taxpayers and tax specialists. We always follow principle – the law is a priority, not the “plan above all”. Budget receives as much as the actual existing base and current legislation allows” – emphasized Oleksiy Lyubchenko.
He also noted that any pressure on business is unacceptable for the STS. Tax authorities are working to provide comfortable conditions for taxpayers to pay taxes on time and in full amount, as well as to stop using tax evasion schemes.
31.6 billion UAH was provided to the general fund of the state budget in September 2020. This is 5.2 billion UAH or 1.9 times more than expected. This year’s September revenues have increased by 3.7 billion UAH comparing to 2019.
85 billion UAH of the value added tax was collected during January – September 2020. This is 24.9 billion UAH or 1.4 times more than during the same period in 2019. Actual level of revenues exceeded expected by 25.7 billion UAH or by 43.3%.
Taxpayers received reimbursement totaling 104.3 billion UAH of the value added tax during 9 months of 2020.
More than 1.9 million business entities have submitted electronic reports to the State Tax Service of Ukraine since the beginning of year.
Taxpayers sent almost 309.3 million documents in electronic form to the STS.
Also, the STS has provided more than 3.2 million administrative services to taxpayers since the beginning of year.
It is important for the State Tax Service of Ukraine to ensure transparency and openness of its activities, effective interaction with civil society institutions and business community.
STS is always open to cooperation and constructive dialogue with the public which contributes to the successful implementation of Tax service’s reforms and achievement of interests’ consensus of the state and business.
Active position of representatives of civil society institutions and business associations provides an opportunity for the Tax service to receive feedback from both domestic and foreign business in Ukraine, promptly respond to possible problem situations, evaluate effectiveness of implemented measures, and, if necessary, make timely adjustments and implement new projects.
On the 5th of June 2020 during a meeting with Chairman of the State Tax Service of Ukraine Oleksiy Lyubchenko, President of the American Chamber of Commerce in Ukraine Andy Hunder noted the long and positive history of cooperation with the Tax service and expressed confidence in its dynamic development to continue economic reforms, promote functioning of business environment in Ukraine on the basis of fairness and transparency.
Chairman of the Council of Employers Federation of Ukraine Dmytro Oliynyk noted efficiency of the State Tax Service of Ukraine and ensuring budget revenues by eradicating the “shadow” and not by “squeezing juices out of business”. He also expressed confidence that today’s openness of the STS in communications with entrepreneurs and readiness to promptly eliminate problematic issues for doing business is a guarantee of positive change
(https://facebook.com/story.php?story_fbid=1364764907050691&id=100005515845604).
He also noted that at present the STS is actively holding meetings and consultations with business on many issues related to improving the administration of taxes and fees, building partnerships and combating corruption. According to him, this is the basis for further cooperation and implementation of budget indicators
(https://facebook.com/story.php?story_fbid=1319455004915015&id=100005515845604).
Statement of the Association of Taxpayers of Ukraine dated 01.08.2020 stated that the State Tax Service of Ukraine finally shows openness, transparency, positive results and has already provided more than 10 billion UAH of additional budget revenues over the last 3 months
(https://www.facebook.com/393701834060994/posts/30090832658561).
Ensuring a constructive dialogue between the STS and business was also noted by the leadership of the European Business Association. A number of meetings were held to address the problematic issues of companies and systematic solution of issues in tax administration.
On the 21st of July 2020, acting Deputy Chief of Mission of the U.S. Embassy in Ukraine Joseph Pennington during the meeting with Chairman of the State Tax Service Oleksiy Lyubchenko assured of support for reforms in the Tax service, namely measures to combat corruption, modernization of IT systems to introduce new services, information security and expressed readiness for further cooperation if the Tax service’s commitment to reform is maintained.
The IMF representatives noted positive changes in the STS’s work in recent months. They are impressed by the sequence of steps made by the Tax service and its balanced internal policy aimed at achieving results.
Following meetings of Chairman of the State Tax Service Oleksiy Lyubchenko and business representatives, the STS introduced a Communication Tax Platform in June 2020. The main purpose of this platform is high quality and prompt communication with people’s deputies, advisory and other subsidiary bodies established by the President of Ukraine, the Cabinet of Ministers of Ukraine and associations representing the taxpayers’ interests.
New format of work effectively helps to address issues of concern to companies and taxpayers’ associations and to identify systemic problems that require operational management decisions or legislative decisions.
It was possible to eliminate criminal VAT schemes that costed tens of billions of UAH to the budget due to the strengthening of counteraction against tax evasion, optimization of work and change of the STS’s priorities.
The un-shadowing of economy is facilitated by the STS’s measures to destroy the value added tax schemes, effective operation of electronic administration systems of VAT and excise tax, strengthening control over the production market and turnover of excisable products.
In order to counter budget losses due to the avoidance of income tax obligations by international companies, special attention is paid to the implementation of steps of the BEPS plan in Ukraine (Base Erosion and Profit Shifting, erosion of the tax base and withdrawal of profits from taxation).
International online conference “Implementation of the BEPS plan in Ukraine” was organized and held by the State Tax Service of Ukraine during 24th – 25th of September 2020.
Conference was also attended by representatives of the Ministry of Finance of Ukraine, other government agencies and key international partners. Conference focused on four main areas: implementation of the BEPS Action Plan, practical challenges in the transfer pricing, application of double taxation conventions and international exchange of information.
During the conference it was noted that currently the legal basis for implementation of most steps of this plan has been formed in Ukraine. Specifically, the Law of Ukraine as of 16.01.2020 № 466-IX “On Amendments to the Tax Code of Ukraine to improve tax administration, eliminate technical and logical inconsistencies in tax legislation” which entered into force on 23.05.2020, introduces a number of fundamental changes aimed at combating erosion of the tax base and withdrawal of profits from taxation, increasing tax transparency, compliance with tax norms and improving tax administration, formal introduction of principle “prevalence over form” and other important anti-tax rules that bring Ukrainian tax system closer to the OECD standards.
Such intensive changes in the national legislation give a clear signal to Ukrainian business and beneficiaries of foreign companies to work under transparent rules in equal competitive conditions.
