Third package of legislative amendments to support business: Key provisions

Author

Valery Moiseev

On March 24, the Verkhovna Rada passed in general the third package of legislative amendments aimed at supporting businesses and taxpayers during wartime (bill No. 7190). People's Deputy Nina Yuzhanina explains what these amendments are and supplements them with her comments.

Tax matters

During martial law (ML), the right is granted to local governments to impose local taxes and fees under a simplified procedure.

Enterprises that purchase agricultural products from individuals will pay personal income tax on the income paid to such persons and submit reports on the income paid without detailed personification (but the question arises: how will the exemption from personal income tax for income in the amount of 12 minimum wages be applied?).

Registration of VAT payers who, during ML, will switch to taxation with a single tax of the third group, will be suspended, not cancelled. This means the suspension of all rights and obligations of VAT payers, including the formation of a tax credit.

During ML, transactions made by a single taxpayer of the third group will not be subject to VAT, and after the end of ML and the restoration of the normal status for the VAT payer, they will have to adjust the tax credit for goods sold during ML.

The tax period for single taxpayers of the third group is a calendar month (in the previous edition it was a quarter).

Features of taxation of single taxpayers of the third group will be applied from the working day following the day of filing the relevant application (previously, it was from the 1st day of the month following the day of filing the application).

The period during which payers will be required to register excise and tax invoices after the end of ML has been increased from 3 to 6 months.

During ML, tax documents in hard copy may be submitted to the regulatory authority.

Residential real estate belonging to legal entities and individuals are exempted from real estate tax for 2021 and 2022, and from March 1, 2022 to December 31 of the year in which ML will be canceled, non-residential real estate located in territories where hostilities are taking place and in the temporarily occupied territories will also be exempted from this tax.

From April 1, 2022, for the period of ML, the import of any goods (including vehicles) into the customs territory of Ukraine (except for those imported from the territory of the aggressor country) by single taxpayers of the first, second, and third groups is exempt from VAT.

From April 1, 2022, for the period of ML, the import of cars and trucks, motorcycles, buses, and trailers by individuals will be exempt from VAT, excise tax, and duties.

The moratorium on conducting desk audits of tax declarations of single tax payers of the fourth group has been abolished.

The provision of environmental tax benefit that will be applied in 2022 by taxpayers registered at the location of stationary sources of pollution in the territories where hostilities took place and in the temporarily occupied territories has been limited.

Customs matters

Passage of goods to Ukraine will be carried out by the customs authorities without applying to them the prohibitions and restrictions established by law (except for a number of dangerous goods).

During ML, goods (except for alcohol, tobacco, and goods originating from the aggressor country) will be exempted from import duties.

Import of goods by payers of the first, second, and third groups (except for those with a tax rate of 3%) will be carried out with the submission of a preliminary customs declaration, and the time of customs clearance cannot exceed one working hour.

For the period of ML, the fee for the customs authorities to perform customs formalities outside the location of the customs authorities or outside working hours has been canceled.

For the period of ML and state of emergency (SE), documentary verifications regarding the credibility, completeness of accrual and payment of customs duties do not begin, and verifications that have been started are stopped.

For the period of ML, the terms of registration of objects of intellectual property rights in the customs registry will continue automatically.

For the period of ML, customs clearance of gasoline, diesel fuel, and liquefied gas will be carried out according to a preliminary customs declaration without bringing and presenting to the customs authority.

"I have to admit that there are still a number of issues in the tax and customs legislation that require further improvement or at least adjustment, so that really favorable conditions are created for the resumption and further work of business under martial law," Yuzhanina summed up.