The provisions of the draft law include increasing the military levy rate to 5%, introducing additional military levy taxation for single tax payers in groups I-IV, raising the corporate income tax rate for banking institutions, advance tax payments for gas stations, and the introduction of monthly unified reporting for personal income tax (PIT), military levy (MТ), and unified social tax (UST) from 2025 (according to Ukraine’s Ministry of Economy, monthly reporting is necessary for economic exemptions).
Changes in military levy taxation (MТ):
- Raising the ML rate from 1.5% to 5% for all wages, including for Diia City! This provision takes effect upon the law’s publication, and if published in October, the 5% MT will apply retroactively from October 1, 2024.
- Other individual income (not wages) will be taxed under the current 1.5% MТ rate until the end of the year, with the 5% rate beginning on January 1 of the next year.
Introducing MT for individual entrepreneurs:
- Groups I, II, and IV: 10% of the minimum wage (as of the first day of the current month), meaning that in Q4, FOPs will begin paying 800 UAH per month in MТ.
- For FOPs and legal entities in group III of single taxpayers – 1% of income.
Changes in corporate income tax:
- Increasing the tax for banks – the rate will be 50% by the end of the current year, prohibiting the inclusion of past year losses.
- From January 1, 2025, a 25% tax rate will apply to financial companies, excluding insurers.
- Monthly advance tax payments for gas stations (both legal entities and individuals on the general tax system) will be 60,000, 45,000, or 30,000 UAH for each fuel sales point, with no carryover of overpayments to future tax periods.
- Updated advance payment rules for currency exchange points – 700 euros for each exchange point in Kyiv, 600 euros for cities with a population over 50,000, and 200 euros for others.
Changes in personal income tax (PIT):
- Increasing the minimum tax obligation for land – from January 1, 2024, until the end of the war, it cannot be less than 700 UAH per hectare (excluding territories where active combat is or was taking place or temporarily occupied areas).
- Exempting citizens’ income from the national cashback program (Made in Ukraine).
- Monthly reporting for PIT, MT, and UST will be reinstated from January 1, 2025.
During the vote, amendment No. 988, which outlined several important provisions for taxpayers, was rejected, including:
- Granting exemptions from MT for FOPs registered in temporarily occupied or active combat zones.
- Deferral of MT payment for the first month in which the law takes effect and no penalties for non-payment of MT for October.
- Exemption from the 5% rate for income subject to annual declaration for 2024 (important for FOPs on the general system and foreign income).
- Exemption from MT payment if a FOP ceases business operations between October 1 and the law’s effective date.
- Exemption from MT payment for electronic residents (e-residents).
This amendment is crucial for the proper implementation of the provisions of draft law No. 11416-d, and according to some MPs, it may be re-voted in the Verkhovna Rada.
