Tax officials proved in court legality of charging penalty for violation of settlement deadlines in the foreign exchange sphere

Press service of the State Tax Service of Ukraine, published 15 August 2024 at 09:15 Chapter: News

Court supported the controlling authority’s position regarding legality of adopted tax notification-decision, which imposed a fine on the plaintiff for violation of settlement deadlines (product delivery deadlines) in the foreign economic activity sphere.

Resolving this dispute, the courts correctly took into account that violation of the payment term in foreign currency took place in a period from 01.07.2016, i.e. the next day after the end of term extended by conclusion of the Ministry of Economic Development and Trade of Ukraine, and until 21.05.2017 – the last day before the claimant applied to the Arbitration Institute at the Stockholm Chamber of Commerce and Industry for protection of his violated right under the contract, on the basis of which arbitration proceedings were initiated.

Also, the courts correctly took into account that the claimant’s appeal on 21.04.2014 to the Arbitration Institute at the Stockholm Chamber of Commerce and Industry does not stop the penalty, since decision of the Arbitration Institute at the Stockholm Chamber of Commerce and Industry as of 10.05.2017 was rejected due to non-payment of the registration fee collection.

The courts found that the total cost of products not delivered by non-resident to the plaintiff is 52658700.00 USA, the corresponding amount was declared by the plaintiff in petition as of 21.04.2014 to the Arbitration Institute at the Stockholm Chamber of Commerce and Industry and was not denied by the plaintiff during the case trial. Therefore, the tax authority correctly calculated penalty, taking into account 325 days of delay in the product delivery, cost of undelivered products.

In addition, as correctly considered by the courts, the Law of Ukraine "On procedure for carrying out settlements in foreign currency", which is a special for purposes of applying sanctions for violation of the payment terms in foreign currency, does not provide for the possibility of taking into account exchange rate difference in case of returning funds in the future.

Cassation administrative court as a part of the Supreme Court on 23.07.2024 in case № 826/17473/17 dismissed the plaintiff’s cassation appeal; decision of the District administrative court of Kyiv city as of 04/05/2018 and decision of the Kyiv appeal administrative court as of 18.09.2018 were left unchanged.