Taxpayers, attention!

Regarding renewal of effect of certain norms of the Tax Code of Ukraine

Reminder! According to Order of the Cabinet of Ministers of Ukraine No. 338 as of 25.03.2020 "On the transfer of unified state system of civil protection to the state of emergency" (taking into account introduced changes and additions) in order to prevent spread of the acute respiratory disease COVID-19, caused by the SARS-CoV-2 (COVID-19) coronavirus, quarantine was introduced on the territory of Ukraine, effect of which ends on June 30, 2023.

In connection with the end of quarantine, from July 1, 2023, norms of the Tax Code of Ukraine (hereinafter - Code), which established separate preferential taxation regimes for the quarantine period, will cease to apply.

In addition, on June 30, 2023, effect of separate rules for еру VAT and excise tax on provision in the customs territory of Ukraine and import to the customs territory of Ukraine of motor gasoline, heavy distillates, liquefied gas, biodiesel, motor alternative fuel, classified according to codes of Ukrainian Classification of the Foreign Economic Activity products, will end , defined by Paragraph 41 of Sub-section 5 Section XX of the Code (Paragraph 82 of Sub-section 2, Paragraph 41 of Sub-section 5 Section XX of the Code).

That is, from July 1, taxation rules that were changed or suspended until July 1, 2023 and/or until the end of quarantine are renewed.

I. VAT

The VAT exemption regime for import operations to the customs territory of Ukraine and/or provision of products to the customs territory of Ukraine, list of which is approved by Resolution No. 224 of the Cabinet of Ministers of Ukraine as of 20.03.2020, established by Paragraph 71 of Subsection 2 Section XX of the Code, is canceled (products for counteraction against COVID-19).

Effect of 2. Paragraph 72 of Sub-section 2 Section XX of the Code is cease to apply, according to which operations, provided for by Paragraph 71 of Sub-section 2 Section XX of the Code and/or Sub-paragraph 197.1.15 Paragraph 197.1 Article 197 Section V of the Code, carried out by public associations and/or charities organizations during the quarantine, were not included in calculation of the total amount for purposes of obligatory registration as the VAT payer.

The VAT taxation at the 20% rate is restored on import to the customs territory of Ukraine and provision to the customs territory of Ukraine of fuel (motor gasoline, heavy distillates, liquefied gas, biodiesel, alternative motor fuel, classified according to codes of Ukrainian Classification of the Foreign Economic Activity products, defined in Paragraph 41 of Sub-section 5 Section XX of the Code, crude oil or petroleum products obtained from bituminous rocks (minerals), classified according to codes of Ukrainian Classification of the Foreign Economic Activity products 2709 00 10 00 and 2709 00 90 00) (except when such products are subject to the VAT at the 0% rate according to the Code)*.

* Paragraph 82 of Sub-section 2 Section XX of the Code.

II. In the excise tax terms

1. Regarding the excise tax rates

Basic excise tax rates, established by Sub-paragraph 215.3.4 Paragraph 215.3 Article 215 of the Code*, are restored, namely for:

- motor gasoline, other petroleum products – 213.50 euros per 1000 liters;

- heavy distillates – 139.50 euros for 1000 liters;

- alternative motor fuel – 162 euros for 1000 liters.

For reference: * Paragraph 41 of Sub-section 5 Section XX of the Code stipulates that "Temporarily, for a period until termination or abolition of the martial law on the territory of Ukraine, introduced by Decree of the President of Ukraine "On introduction of the martial law in Ukraine" No. 64/2022as of 24.02.2022, approved by the Law of Ukraine "On approval of Decree of the President of Ukraine "On introduction of the martial law in Ukraine" No. 2102-IX as of 24.02.2022, but not longer than July 1, 2023..."

2. Regarding shipment of ethyl alcohol for production of disinfectants

There is canceled:

- temporary procedure for shipment of ethyl alcohol for production of disinfectants.

The following begins to be applied to producers of medicinal products:

general requirements regarding taxation peculiarities, targeted use and repayment of tax bills, which are established by Article 229 of Section VI of the Code in production of disinfectants, using ethyl alcohol, which is taxed at the 0 hryvnias rate per 1 liter of 100 percent alcohol.

III. In the corporate income tax terms

For corporate income tax payers application of differences defined by the Code regarding reduction of financial result before taxation by the amount of income included in income of reporting period according to the accounting rules in the form of:

- received one-time compensation by business entities according to the Law of Ukraine "On social support of insured persons and business entities for a period of implementation of restrictive anti-epidemic measures introduced to prevent spread of the acute respiratory disease COVID-19 caused by the SARS-CoV-2 coronavirus on the territory of Ukraine";

- written-off fines and penalties according to Paragraph 2³ and written-off tax debt according to Paragraph 2⁴ and Sub-paragraph 26.2 of Paragraph 26 Sub-section 10 Section XX of the Code.