Court confirmed legality of tax notification-decision regarding application of financial sanctions

Press service of the State Tax Service of Ukraine, published 04 November 2024 at 09:16 Chapter: News

Cassation court supported the controlling authority’s position regarding legality of adopted tax notification-decision on the application of financial sanctions to the plaintiff in the form of a fine for storage and use in the customs territory of Ukraine of equipment for the industrial production of cigarettes, which was not entered in the Unified register of equipment for the industrial production of cigarettes.

The courts reasonably rejected the payer’s reference to the fact that the specified equipment is not capable of independently producing cigarettes, since such statement does not refute the fact that it is precisely equipment for the processing of tobacco and tobacco dust, has a code according to Ukrainian classification of the foreign economic activity products and has a model and serial number equipment, and therefore must be registered in relevant Register of equipment.

The Supreme Court critically evaluates the claimant’s reference to the fact that equipment imported by him is only auxiliary parts and it cannot be used independently for production of cigarettes, in connection with which the payer submitted only applications for changes to the information regarding the main equipment, which are contained in the Unified register of equipment, since they do not refute the violation committed by the plaintiff, as well as the fact that the purchased equipment has code according to Ukrainian classification of the foreign economic activity products.

The courts falsely did not accept the plaintiff’s evidence that he is not a business entity that carries out storage or use of equipment, since the defendant applied Paragraph 2 of Part 3 Article 2-1 of the Law of Ukraine "On state regulation of production and circulation of ethyl alcohol, cognac and fruit alcohol, alcoholic beverages, tobacco products, liquids used in electronic cigarettes, and fuel" (which imposes obligation to register equipment on the owner or importer of such equipment), and not Paragraph 3 of Part 3 Article 2-1 of the specified Law.

Therefore, Cassation Administrative Court as a part of the Supreme Court on 17.10.2024 in case № 520/20269/21 dismissed the plaintiff’s cassation appeal; decision of Kharkiv District Administrative Court as of 19.01.2022 and decision of Second Administrative Court of Appeal as of 06.02.2023 were left unchanged.