Draft Law of Ukraine

“On Tax Amnesty”

This draft envisages legalization of profits gained by legal entities and natural persons in order to create prerequisites for returning funds and property values previously brought outside Ukraine’s territory.

Tax amnesty provides for releasing payers of taxes, duties (mandatory payments) or their officials from financial, administrative, criminal responsibility for non-declaration, evasion to pay or intentional evasion to pay tax liabilities, or evasion to declare currency values placed outside Ukraine until the date of this draft enactment.

At the same time, tax amnesty shall not apply to liabilities to pay taxes, duties (mandatory payments), as well as fines, penalties and administrative penalties, which were calculated by control bodies or by taxpayers but have not been paid till enactment of the draft law.

The following liabilities to make payments shall be subject to tax amnesty:

• enterprise profit tax;
• value added tax that shall be paid structural element of the price while purchasing objects of movable or immovable property;
• personal income tax;
• taxes, duties (mandatory payments), the taxation base thereof is the wages fund;
• land tax;
• duty to the State Innovations Fund;
• trade patent value;
• utility tax;
• amounts of fines, penalties and administrative penalties as stipulated by legislation for violation of tax or currency legislation.

Tax amnesty is likely to affect the residents’ property objects outside customs territory of Ukraine, which have been acquired in defiance of the rules of currency regulation or currency control.

In order to implement tax amnesty individuals, possessing objects subject to tax amnesty, shall issue declaration within the terms mentioned in the draft. For legal entities such term is 365 days following the day of the draft enactment; for natural persons – until expiration of the term for submitting deflation on the annual aggregate taxed revenue according to the results of 2002.

Persons who declare objects of tax amnesty are exempted from compulsory submission of information on the sources of their revenue or property objects, or other documents which may, directly or indirectly, evidence existence of such sources, except for instances directly envisaged in the draft law.