Draft Law of Ukraine

"On Amendment of the Article 5 of the Law of Ukraine "On the Procedure for Payment of Taxpayers’ Liabilities to the Budgets and State Special-Purpose Funds"

According to this draft the sub-clause 5.2.7 of the clause 5.2, Article 5 of the Law "On the Procedure for Payment of Taxpayers’ Liabilities to the Budgets and State Special-Purpose Funds" shall be added with a provision providing for the possibility for a taxpayer to initiate decision on tax compromise. Now in conformity with the current wording of the sub-clause 5.2.7, clause 5.2 of Article 5 the right to initiate decision on tax compromise is granted to representatives of tax body.

This draft suggests extending the list of bodies, which a taxpayer has the right to make compromise decision relating to calculation of tax liabilities with. Such bodies will include customs authorities, institution of the Pension Fund of Ukraine, institution of the Social Insurance Fund of Ukraine.

Provision to taxpayer of the right to initiate conclusion of tax compromise, as well as extended list of bodies which the taxpayer has the right to concluded tax compromise with will allow to expand the existing ways to resolve disputes between taxpayers and control bodies arising out of payment of taxes and making other mandatory payments.

However, this draft stipulates instances, which serve the grounds to cancel decisions made on tax compromise by taxpayer and control body. Such grounds are the following: information received by the control body from a taxpayer if it is inadequate, incomplete, false or if a taxpayer violates conditions of repayment of tax debt. In such instances decision on canceling tax compromise may be taken at the initiative of a control body.

The right of the control body to cancel at the own initiative the decision on tax compromise after such decision is made and fulfillment by taxpayer of relevant actions pay the agreed tax liabilities will create conditions under which agreements reached between taxpayer and control body will, in fact, become invalid at the initiative of one party – control body. Such proposals will place taxpayers and control bodies under unequal conditions.