Today members of the Union of Ukrainian Entrepreneurs (SUP) met with the chairman of the State Tax Service Oleksiy Lyubchenko.
The focus of the meeting was on initiatives for tax reform, technical issues of implementation of program registrars of settlement transactions (RST) in e-commerce and for fiscalization of software and hardware self-service complexes (SHSC) by non-bank financial companies. They also talked about improving the work of the Electronic cabinet of the taxpayer, ensuring transparent operation of VAT administration systems (monitoring system of risk assessment criteria) and the execution of court decisions on the unlocking tax invoices.
Reduction of single social contribution (SSC) to 10%
According to official data of the Ministry of Finance of Ukraine previous experience of reducing SSC has shown that since 2016 (after reducing SSC to 22%) average salary has grown faster than inflation and budget revenues from PIT have increased by an average of UAH 40 billion annually. That is why the Union has consistently stood for a gradual reduction of SSC to 10% as one of the incentives for the development of domestic business.
In the context of the discussion of this initiative the chairman of the State Tax Service mentioned that the idea of reducing the burden on the salary fund is correct and needs to be implemented. However, it is worth looking for so-called “compensators” that will help level out budget losses from the reduction of SSC – Tax Service sees them in expanding the scope of taxation (taxation of those who work in the shadows nowadays).
Introduction of an exit capital tax (ECT) for all companies
SUP communicates the effectiveness of this tax model to all stakeholders. So it was agreed with the State Tax Service that we will continue the expert discussion on ECT with calculations and compensators in order to finally enlist the support of this idea on their part.
Program registrars of settlement transactions (RST)
The attention of the chairman of the State Tax Service was drawn to the technical issues of work of the program RST, which participants are now facing. In particular, such issues as the need to obtain qualified electronic signatures for each SHSC, the impossibility of daily reporting of SHSC, etc. Representatives of SUP also asked to provide clarification, algorithm of action, business advice on the use of RST/PRST during settlement transactions in e-commerce. It is important for the representatives of this sphere to be able to get acquainted in advance with all the requirements and innovations that they will face in 4 months.
Cashback
From January 1, 2021 the provisions on the control mechanism for settlement transactions, the so-called “cashback”, come into force. In fact it will only affect entrepreneurs who are already officially doing business and paying taxes, and does not apply to those entrepreneurs who do not have RST at all and do not issue fiscal checks. Therefore, SUP stands for abolition of the cashback mechanism and proposes to replace it with a lottery of fiscal checks. Moreover, we already know examples where in Ukraine the lottery mechanism is used in separate united territorial communities for excisable groups of goods to increase revenues to local budgets (5% of sales of excisable groups of goods goes to the local budget).
Ensuring transparent operation of value-added tax (VAT) administration systems and execution of court decisions on unlocking tax invoices
Despite the constant “improvements” of the monitoring system of risk assessment criteria by the supervisory body, about 80% of tax invoices are unreasonably blocked, which is recognized by commissions of the State Tax Service themselves.
Therefore, the proposal of SUP is to introduce indicators in the criteria for assessing the effectiveness of the State Tax Service that would reduce the percentage of unreasonably blocked tax invoices and reduce the time (costs) spent by businesses to unlock them. A list of companies whose court decisions on unlocking have not been executed was also handed over to the chairman of the State Tax Service.
In the ranking of “Doing Business” in the area of “Paying Taxes” Ukraine is constantly falling (the last time by 11 positions – from 54 to 65th place). And to a greater extent, this is due to the fact that nowadays the Ukrainian entrepreneur still spends too much time on accounting and reporting. Therefore, in the end of the meeting it was agreed to jointly look for ways to improve these indicators and to continue an open systematic dialogue with the State Tax Service.
