Yevhen Oleinikov: VAT reimbursement cannot be subject to manipulation

State of the VAT reimbursement this year and measures of the STS to prevent use of illegal schemes in this area were the main topics of briefing by Deputy Chairman of the STS Yevhen Oleinikov and Head of Main Directorate of the STS in Odessa region Julia Shadevska.

Yevhen Oleinikov noted that the taxpayers paid 236.9 billion UAH of VAT to the budget during January – November 2020. During the specified period in 2019, this figure amounted to 218.4 billion UAH. After reimbursement, the budget had a balance of 76 billion UAH in 2019 and 108 billion hryvnias in 2020.

Growth of indicators was consistent. Thus, level of revenues provided by current law on the state budget was provided in September this year, in October – the annual indicators of 2019 were exceeded, in November –level of revenues exceeded the initial indicator which was laid in the state budget for 2020 without further quarantine reductions.

At the same time, as Yevhen Oleinikov specified, it is important for the STS not only how much money was transferred to the budget but also the tools and price of such revenues.

“We are well aware that taxes are paid by taxpayers. STS only acts as an administrator. And the price for economy, the price for payers and the price of funds for state received in the system of public finances also depend on how we define our tasks and apply the tools in general.” – emphasized Deputy Chairman of the STS. 

128.7 billion UAH was reimbursed to payers during January – November 2020. At the same time, the claim for reimbursement amounted to 122.2 billion UAH; the transitional balance from last year is 4.3 billion UAH. That is, amount of reimbursed VAT exceeded amount of the claim for reimbursement with balances of the previous period by 2.2 billion UAH.

Amount of VAT claimed for reimbursement, taking into account the transitional balance from 2018, amounted to 146.2 billion UAH in 2019. Namely, 142.1 billion UAH was reimbursed to payers.

“One of the principal positions of the STS is that reimbursement cannot be subject to manipulation. Reimbursement is not a source of budget replenishment. These are payers’ funds. And the best help we can provide in the quarantine conditions is to quickly perform administrative actions, make sure that the reimbursement is legal, make appropriate decisions and provide payers with a timely return of their working capital.” – emphasized Yevhen Oleinikov. 

He also reminded that the STS operates in quarantine conditions, which provide for significant administrative restrictions. Thus, according to him, from the tools for VAT administration, the tax authorities had only audits for reimbursement and monitoring of tax invoices registration. STS actively worked in these areas. Due to this, tax efficiency has significantly increased, ie the ratio of paid taxes to the base of their accrual.

Revenues growth was also affected by the terminated VAT abuse schemes.

Recently in Odessa, the operation of scheme for the formation of tax credit with fictitiousness signs and, accordingly, applications for VAT reimbursement was terminated. A group of companies systematically worked in Odessa region, claiming reimbursement of 1.1 billion UAH. At the same time, such tax credit was formed by the balances of allegedly unsold goods. Some of them, according to provided payer’s data, were in the warehouse for more than a year and a half. To verify reality of claimed amounts, the law enforcement officers inspected the warehouses where goods were to be stored. Instead, as it turned out, there were no declared goods there, moreover, these warehouses were not suitable for storage at all. Due to the coordinated work of NABU and the STS, the illegal reimbursement of 800 million UAH was prevented.

“STS will continue to use all tools to effectively counter the formation of a dubious tax credit and inform law enforcement agencies with which the STS actively cooperates. Thanks to this cooperation, we have developed legal methods that we use to protect honest taxpayers, public finance system, taxpayers’ funds from criminal encroachments.” – specified Yevhen Oleinikov.

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