The Verkhovna Rada of Ukraine adopted the Law of Ukraine № 2618-IX "On amendments to Section XX "Transitional Provisions" of the Tax Code of Ukraine regarding the excise tax rates for a period of legal regime of the martial law, state of emergency" (hereinafter - Law № 2618) on September 21, 2022.
On September 30, 2022, the Law № 2618, which was published in a newspaper "Holos Ukrayiny" № 199 on September 29, 2022, entered into force, and therefore amendments introduced by it to the Tax Code of Ukraine (hereinafter - Code) are applied starting from September 30, 2022.
Amendments introduced by the Law № 2618 to the Code introduced new excise tax rates for certain types of fuel and oil products, as well as defined new application features of the 7% VAT rate to operations on the supply and import of certain types of fuel and oil products.
Amendments in excise tax.
Regarding excise tax rates.
Starting from September 30, 2022, the following excise tax rates have been temporarily introduced for a period until termination or abolition of the martial law on the territory of Ukraine, but no longer than until July 1, 2023:
for motor gasoline, heavy distillates - 100.00 EUR per 1000 liters;
for liquefied gas, butane, isobutane - 52 EUR for 1000 liters;
for biodiesel and its mixtures, as well as for alternative motor fuel - 100.00 EUR per 1000 liters.
In addition, temporarily for heavy distillates (gasoil), biodiesel and its mixtures (which do not contain or contain less than 70 wt.% of oil or petroleum products obtained from bituminous rocks) based on monoalkyl esters of fatty acids, according to the codes according to Ukrainian classification of the FEA products, specified in Paragraph 44 of Sub-section 5 Section XX "Transitional provisions" of the Code, the customer of whom according to the terms of contract is the Ministry of Defense of Ukraine, the excise tax rates are set at the level of 0 EUR per 1000 liters.
Regarding the tax bill registration.
To import to the customs territory of Ukraine or to sell heavy distillates and biodiesel produced in Ukraine, the importer or producer of heavy distillates and biodiesel issues the tax bill, if the customer of such fuel according to the terms of contract is the Ministry of Defense of Ukraine.
Paragraph 44 of Sub-section 5 Section XX "Transitional provisions" of the Code stipulates:
issues and amount for which the tax bill is issued, term for which the tax bill is issued (cannot exceed 180 calendar days);
repayment of the tax bill, including on lost heavy distillates and biodiesel;
calculation of the amount of excise tax on volumes of heavy distillates and biodiesel, intended use of which has not been confirmed;
making a protest of the bill by the promissory note holder, if the tax promissory note is not repaid within the prescribed period;
calculation and payment of a fine from an importer or producer who issued the tax bill, heavy distillates and biodiesel, for which there is no confirmation of intended use.
It is also stated that business entities (producers or importers) have a right to sell heavy distillates and biodiesel to other persons in case of payment of excise tax at the full rate of 100 EUR per 1000 liters (defined as the difference between the rate of 100 EUR per 1000 liters and the rate of 0 EUR for 1000 liters).
Regarding the temporary reflection in requisites of the excise invoice form "P" of the tax terms and requisites of the tax bill.
Paragraph 45 of Sub-section 5 Section XX "Transitional provisions" of the Code stipulates that selling heavy distillates and biodiesel, the customer of which according to the terms of contract is the Ministry of Defense of Ukraine and which are taxed at the excise tax rate of 0 EUR per 1,000 liters, in requisites of the excise invoice drawn up during such sale, an indication regarding the sale of fuel under conditions specified c 44 of Sub-section 5 Section XX "Transitional Provisions" of the Code, must be specified with requisites of the tax bill, business entities that will sell heavy distillates and biodiesel to the customer specified in Paragraph 44 of Sub-section 5 (Ministry of Defense of Ukraine).
Prior to the introduction of specified amendments to forms of documents and procedures for their filling in, approved by Order of the Ministry of Finance of Ukraine № 729 as of 27.11.2020, registered in the Ministry of Justice of Ukraine on 14.12.2020 under № 1241/35524, carrying out operations specified in Paragraph 44 of Sub-section 5 Section XX "Transitional Provisions" of the Code, such documents are drawn up taking into account such peculiarities.
The excise invoice form "P" states:
- operation code for making in one copy:
or "0";
or "2" - lost, spoiled, destroyed fuel (Paragraph 214.7 Article 214 and Paragraph 216.3 Article 216 Section VI of the Code);
or "3" (sale of fuel to a non-paying business entity) - selling heavy distillates (gasoil) and biodiesel, if the customer of such fuel according to the terms of contract is the Ministry of Defense of Ukraine;
or "4" - introduction (import) of fuel to the customs territory of Ukraine;
- taxation condition "3" (aviation gasoline or fuel for jet engines imported to the customs territory of Ukraine or produced in Ukraine, which is taxed under conditions established by Paragraph 229.8 Article 229 Section VI of the Code with issuance of the tax bill) for imported to the customs territory of Ukraine or produced in Ukraine, heavy distillates and biodiesel, which are taxed under conditions established by Paragraph 44 Sub-section 5 Section XX "Transitional provisions" of the Code, if the customer of such fuel according to the terms of contract is the Ministry of Defense of Ukraine;
- requisites of the tax bill - throughout the supply chain from the importer / producer of heavy distillates (gasoil) and biodiesel to the Ministry of Defense of Ukraine, if the customer of such fuel according to the terms of contract is the Ministry of Defense of Ukraine;
- one of the directions of use can be specified:
or "0";
or "10" (sale of fuel according to Sub-paragraph 229.8.10 Paragraph 229.8 Article 229 c VI of the Code to customers who made the purchase to meet needs of the state or territorial community) - for operations on the sale of heavy distillates and biodiesel to the Ministry of Defense of Ukraine, if the customer of such fuel according to the terms of contract, it is the Ministry of Defense of Ukraine according to Paragraph 44 Sub-section 5 Section XX "Transitional provisions" of the Code;
In applications for replenishment (adjustment) of the fuel balance, the following is indicated:
tax condition "3" (aviation gasoline or fuel for jet engines imported to the customs territory of Ukraine or produced in Ukraine, which is taxed under conditions established by Paragraph 229.8 Article 229 Section VI of the Code with issuance of the tax bill) for imported to the customs territory of Ukraine or produced in heavy distillates and biodiesel to Ukraine, which are taxed under conditions established by Paragraph 44 Sub-section 5 Section XX "Transitional provisions" of the Code, if the customer of such fuel according to the terms of contract is the Ministry of Defense of Ukraine;
number 0 in columns 7 (excise tax rate, established by Sub-paragraph 215.3.4 Paragraph 215.3 Article 215 of the Code, EUR) and 9 (amount of excise tax, UAH (-) (+) (UAH. 6 x UAH. 8 x (UAH. 7 / 1000)) .
At the same time, in excise invoices of form "P" and in applications for replenishment (adjustment) of fuel balance, the code is indicated according to the Ukrainian classification of the FEA products of heavy distillates (gasoline) and biodiesel.
Regarding the filling in the excise tax declaration, approved by Order of the MFU № 14 as of 23.01.2015 (with changes), we note for September 2022.
Excise tax payers – fuel producers, as well as persons who are payers for the sale of fuel and who have an obligation to submit an application for replenishment (adjustment) of the fuel balance in September 2022, declare their tax obligations for the vsale, indicating in separate lines volumes from the sale of fuel:
from September 1 to September 29, 2022 (inclusively) - at zero tax rate, which is determined by Paragraph 41 Sub-section 5 Section XX of the Code,
as of September 30, 2022 - at excise tax rates in amounts specified in Paragraph 41 Sub-section 5 Section XX "Transitional Provisions".
At the same time, appropriate amount of the excise tax rate is indicated, in particular, in columns:
12 of Annex 1 "Calculation of the amount of excise tax on excisable goods (products) for which specific excise tax rates have been established (except for operations specified in Sub-paragraphs 213.1.9, 213.1.12 of Paragraph 213.1 Article 213 of the Code)";
9 of Annex 1 Note. 1 "Calculation of the amount of excise tax on the sale of fuel according to Sub-paragraph 213.1.12 of Paragraph 213.1 Article 213 of the Code."
Regarding amendments in the value added tax.
Law № 2618 also amended Paragraph 82 of Sub-section 2 Section XX of the Code, which established the 7% VAT rate for import operations to the customs territory of Ukraine and operations for the supply 0of certain types of fuel and oil products to the customs territory of Ukraine.
The specified amendments intorduced:
period of validity of the specified VAT rate (7%) is limited to the period of martial law, but no longer than until July 1, 2023; before the amendments – period of validity of rate is extended to the entire period of the martial law and state of emergency;
application of the 7% VAT rate is also extended to operations involving mport to the customs territory of Ukraine and supply of biodiesel and alternative motor fuel to the customs territory of Ukraine.