The Cabinet of Ministers will not submit a bill to the Verkhovna Rada in February on the introduction of mandatory VAT for individual entrepreneurs. This was stated by Prime Minister of Ukraine Yulia Svyrydenko during the government’s question hour.
The Cabinet of Ministers will not submit a bill to the Verkhovna Rada in February on the introduction of mandatory VAT for individual entrepreneurs. This was stated by Prime Minister of Ukraine Yulia Svyrydenko during the government’s question hour.
According to the Prime Minister, due to the consequences of massive shelling of energy infrastructure, the IMF agreed to revise some of the previous fiscal requirements.
In particular, this does not currently include:
introduction of mandatory VAT for individual entrepreneurs;
tax for digital platforms;
duties on international postal items (parcels);
changes regarding military conscription.
Thus, the government gained some space to adjust tax policy in the face of war and energy losses.
«In February, the government will not submit to parliament a bill on the introduction of VAT for individual entrepreneurs,» Svyrydenko emphasized .
Thus, the Prime Minister denied information about the alleged preparation of a relevant document this month. At the same time, she did not specify when the government might return to this issue.
Recall that the introduction of VAT for individual entrepreneurs under the simplified taxation system was one of the conditions of the new International Monetary Fund credit program worth $8.2 billion.
It was about the mandatory application of VAT for entrepreneurs with an annual income of over 1 million UAH. This initiative has drawn criticism from the business community and experts. Among the risks were:
growth of the shadow economy;
too low income threshold;
complexity of administration for small businesses, in particular IT sole proprietors.
Despite the revision of some requirements, cooperation with the IMF remains key to Ukraine’s financial stability. The $8.2 billion program is an important signal to international partners, including the EU, and influences further attraction of macro-financial assistance.
The government emphasizes that they are simultaneously working to ensure long-term budget sustainability in the face of significant spending on security and defense.
The issue of VAT for individual entrepreneurs and other tax changes has not been formally removed from the agenda, but their implementation has been at least temporarily postponed.
