Yevhen Oleinikov: Our main task is to protect legal business from competition with shadow

Efficiency of the STS is evidenced by tax administration results: budget revenues have already exceeded annual expectations. This was stated by Deputy Chairman of the STS Yevhen Oleinikov during meeting of the STS Board.

According to him, one of the basic indicators for assessing the value added tax administration results is tax efficiency with VAT.

“We confidently keep the tax efficiency with VAT at a level higher than last year. This indicator makes it possible to assess results of tax work without the influence of such factors as inflation, price changes and so on. This is the basis and result in the form of VAT payment” – specified Yevhen Oleinikov.  

He also stated that results achieved in administration are not only important but also the methods of its provision.

“Currently, the STS provides timely and effective VAT reimbursement to taxpayers. We fully agree the business’ claims for reimbursement, without reducing the effectiveness of control and verification work, as well as control over the VAT reimbursement. This is important not only in terms of business support, especially in conditions of quarantine restrictions, because it is the working capital of business, but also very important to ensure the overall stability of public finance system.” – emphasized Yevhen Oleinikov.    

Deputy Chairman of the STS also noted effectiveness of the risk monitoring system in registration of tax invoices. Thus, the volume of initially suspended tax invoices within the monitoring is less than 1.5% of the amount. However, after the payers explanations regarding operations, most of these invoices are registered administratively by the STS.

“This is not a court appeal but an administrative procedure in which the STS promptly clarifies presence or absence of risks and, in the absence of risks, satisfies the taxpayer’s complaint. Although the law enables the STS to increase consideration time of complaints during the quarantine, we do not use this right, complaints are considered within 5 – 10 days” – stated Yevhen Oleinikov.    

In general according to decisions of the tax authorities, invoices for 2.5 billion UAH have remained unregistered since the beginning of 2020. Of this amount, more than 50% were not appealed by taxpayers to the tax authorities or to the court. This is less than 1% of the total revenues, which is evidence of the risk monitoring system as an effective tax tool to combat VAT abuse. At the same time, there has been an increase in sales since May 2020, which has already exceeded indicators of the corresponding periods in 2019.

“Results of budget revenues show that when we work effectively against the shadow economy, the legal business increases its sales and tax deductions. Therefore, our main task is to protect legal business from competition with the shadow” – emphasized Yevhen Oleinikov.     

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