Parliament tax committee chief elaborates on indirect methods of tax control in Ukraine

12 January 2022, 09:18 PM

Ukraine’s Cabinet of Ministers is drafting a bill on indirect methods of tax control, which may be submitted to parliament this year and come into force after the tax amnesty ends, Chairman of the Verkhovna Rada Committee on Finance, Taxation and Customs Policy Danylo Hetmantsev told the Radio NV radio station on Jan. 11.

This tax amnesty was launched on Sept. 1 of the previous year, allowing citizens to voluntarily declare previously undeclared assets and pay a one-time fee. The amnesty will last until Sept. 1, 2022.

To date, 1.2 billion UAH ($43.8 million) has already been declared under the tax amnesty, which came into force on Sept. 1, 2021.

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Hetmantsev stressed that over UAH 100 million ($3.6 million) had been amnestied over the New Year holidays.

“Thus, the dynamics are growing, and more and more citizens are taking part in the tax amnesty,” he said.

“Since our fellow citizens understand that the modern financial world is very transparent and this is a world in which, whether you want or not, must explain the origin of your funds.”

He added that indirect methods of tax control “are not about auditing the income that people have already received.”

“If someone bought an apartment or house with funds received from tax evasion, no one can take away this apartment or house or charge any additional tax on the value of this asset. Neither the fiscal service nor anyone else is authorized to do that. Therefore, it can only refer to future valuable acquisitions entered into the registries, such as apartments, cars, shares, securities, etc.," Hetmantsev said.

Ukrainian Finance Minister Serhiy Marchenko stated that the authorities would use “indirect methods of determining income” after the tax amnesty expires.

“If you don’t put information into the declaration, you may face questions: where exactly you got this status,” he said, adding that citizens who could not explain the origin of their assets would face “other forms of tax assessment.”

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