Government to review gas producers’ taxation – draft budget resolution for 2016
The Ukrainian government will review the system of taxation of gas production companies irrespective of their form of ownership.
This is stipulated in the draft guidelines of Ukraine’s budget policy, or the budget resolution, for 2016, which was tabled by the Cabinet of Ministers in parliament.
Among the other priorities which require amendments to the current Tax Code is the introduction of indirect methods of control over income and spending of individuals, the transfer of agribusinesses to the standard taxation system with VAT, and amendments to laws to ease pressure on the payroll fund to retrieve wages and salaries from the shadows.
The Cabinet also plans to step up the fight against tax evasion schemes by legal entities and individuals, in particular, through an improvement to VAT administration.
The government will also hammer out a system of tax controls depending on the risks in taxpayer’s activity through the introduction of tax controls on transfer pricing, the expansion of the use of cash registers and the introduction of electronic services for taxpayers. The government also plans to launch an electronic VAT administration system.
The tax control system envisages tax declaration by subjects of natural monopolies, companies that pay subsoil use royalties, and by companies with tax debts.
What is more, the government plans to adapt Ukrainian VAT and excise duty legislation to the laws of the European Union.
Another priority of the updated taxation policy will be a reduction in the number of tax-related obstacles to foreign investment and the prevention of income and capital tax evasion through negotiations with foreign states on international agreements on double taxation avoidance and amendments to the current agreements, in particular, with Cyprus, Switzerland, Luxembourg, and the Netherlands.
