“Restoring Donbas” to prepare recommendations for discriminated entrepreneurs of Donbas
11:50 / 24 Mar. 2017 / 138
The Cabinet of Ministers and Verkhovna Rada discriminated more than 100,000 entrepreneurs of Donbas considered experts of the public initiative of Alexander Klimenko analysing the Law of Ukraine “On Amendments to the Tax Code of Ukraine on improving the investment climate in Ukraine”.
The hot line of the initiative received a number of calls from entrepreneurs who had been come under double taxation due to the place of registration as temporarily uncontrolled territories of Donbas or the “grey zone”.
Experts of “Restoring Donbas” analysed this situation and came to the conclusion that adopted amendments to the Law and to The Tax Code were supplemented with the norms for taxpayers from the ATO zone and put the entrepreneurs of Donbas in an ambiguous position.
To the entrepreneurs, registered on the territory beyond the Government control regardless the taxation system (general or single tax) double taxation had been applied.
The tax innovation should not be extended to small business, chosen a simplified system and entered into the Register of Single Tax Payers. At the same time, in practice, in the absence of explanations of the Verkhovna Rada Committee on Taxation and Customs Policy, the Ministry of Finance, the State Fiscal Service tax agents frightened by the new rule took incomes from small business regardless of the taxation system.
Thus, the experts came to the conclusions. First, in fact, with the help of tax pressure, the entrepreneurial activity of individuals whose location (place of residence) is “temporarily occupied territory and/or the territory of settlements that are located on the line of contact” is paralyzed. And the second, from January 1, 2017, in fact, the government decided to replenish the budget just at the expense of these entrepreneurs.
The only solution offered by the State Fiscal Service is to re-register on the controlled territories. Unfortunately, such a recommendation is unacceptable for small business as they do not have permanent housing and are forced to use hired or other housing. But the issue with the small business from the contact line is even worse as they could not claim for IDP status.
The public initiative sent relevant inquiries to the Verkhovna Rada, the Ministry of Finance and the State Fiscal Service. Upon receipt of the answers we will publish them. Meanwhile, the experts of the initiative had developed recommendations for entrepreneurs by the following the link.
It should be noted that the Verkhovna Rada adopted the Draft Law “On Amendments to the Tax Code of Ukraine on the clarification of certain provisions and elimination of contradictions that arose when the Law of Ukraine” On Amending the Tax Code of Ukraine on Improving the Investment Climate in Ukraine”. However the draft had been published yet.
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