Ukrainian Rada gives oligarchs a free pass on the backs of small business


January 29, 2015
Translated by Kristina Rus

Actually, just what the Ukrainian people wanted. Oligarchy came to power not to make people live better. For oligarchs the most important thing is PROFIT. So they are maximizing it.

Large taxpayers reduced payment of profit tax in 2014 by 13.7 billion UAH, while increased export operations through the countries with a preferential tax system by 25 billion UAH – up to 240 billion UAH. This was reported by former Minister of Revenue and Collections. Aleksandr Klymenko, on his Facebook page.

According to him, the largest companies evaded taxes through Switzerland, UAE, Cyprus, Luxembourg, Panama. These operations cost the budget 4.3 billion UAH in foregone taxes for the year.

“Big business has no more incentive to pay taxes. The law on  transfer pricing (TP), which was supposed to prevent such phenomena, with the light hand of the State Fiscal Service and the deputies of the Verkhovna Rada was first delayed, and then “washed down,” so that it became ineffective as a mechanism for preventing the withdrawal of capital,” – wrote the ex-Minister.

As Klimenko noted, according to the new edition of the law on TP, adopted by the Verkhovna Rada on December 28, 2014, small business gets hit, since control threshold was lowered to a turnover of 20 million UAH ($1,250,000).

Also, said the former official, the audit period is increased to one and a half years, and the reasons for audit are added. “Now they can check in any case – whether you submitted a report, or didn’t, submitted incorrect report, or incomplete report… The previous version had two reasons: the report is not filed and a deviation from market prices was recorded,” – he said.

In addition, writes Klimenko, fines increased again after the lowering. “In May 2014, the penalties were reduced, now returned to the previous level. And the decision to increase the fines would be correct if, according to the same law, small business did not get hit,” – he concluded.

P. S. I have nothing to add, except the phrase: “What did you fight for?” I can see what the oligarchs fought for. But average maidanites – for what?

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