Rada committee approves second reading of VAT bill on sub-150-euro parcels
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Ukraine's Verkhovna Rada (Photo: Ukraine's Verkhovna Rada / Facebook)
Ukraine's parliamentary tax committee recommended passing bills to tax international parcels under 150 euros, the Ministry of Finance reported on Oct. 7.
"Verkhovna Rada Committee on Finance, Tax, and Customs Policy recommended that parliament adopt in the second reading and as a whole the package of bills on the taxation of international postal and express shipments: No. 16051-1 — on amending the Tax Code of Ukraine regarding the specifics of VAT taxation on remote sales of goods; and No. 15460 — on amending the Customs Code of Ukraine regarding customs formalities for such goods," the ministry stated.
Finance officials explained that the interconnected bills establish a modern electronic commerce taxation architecture aligned directly with European Union standards. The legislative reform forms an integral part of Ukraine's cooperation program with the International Monetary Fund (EFF 2026–2029) and represents a key prerequisite for unlocking European Union macro-financial assistance. Its timely adoption brings Ukraine closer to securing roughly 4 billion euros ($4.38 billion) in international budgetary support.
Key Provisions of the Tax Reform
Introduces specialized taxation procedures for remote sales executed via online marketplaces where the cumulative invoice value does not exceed 150 euros ($164).
The standard 20% VAT will apply to imported goods arriving via international postal and express consignments starting from 0 euros.
The legal obligation to calculate and remit VAT directly to the state budget will rest on the digital marketplace (electronic interface entity). Non-resident platforms must designate a registered fiscal intermediary in Ukraine held jointly liable for tax settlements, with platforms permitted to appoint multiple intermediaries.
The 20% VAT will be automatically calculated and included in the purchase price at checkout on the platform interface, leaving physical package pickup procedures unchanged for consumers.
Preserves VAT exemption mechanisms for goods procured for defense and national security purposes, including mechanisms to refund paid VAT to individual citizens who purchase such equipment under remote sales rules.
Retains complete VAT exemptions for non-commercial personal parcels valued up to 45 euros ($49).
Maintains VAT exemptions for goods transported in unaccompanied personal luggage up to 150 euros (personal items or belongings transferred across the customs frontier separately from the traveler).
The statutory provisions are scheduled to take effect no earlier than July 2027.
The Finance Ministry projects the new model will generate approximately 10 billion UAH ($240 million) in additional fiscal revenues annually. Under the legislation, all VAT proceeds collected from cross-border remote sales will be funneled directly into a dedicated special fund within the State Budget of Ukraine to finance the requirements of the Armed Forces of Ukraine.
Additionally, the reform aims to level the playing field between Ukrainian domestic retailers and foreign merchants while implementing a domestic counterpart to the EU's Import One-Stop Shop (IOSS) framework.
Legislative Path and IMF Commitments
Prior legislative stumbling blocks: On May 26, the Verkhovna Rada failed to pass earlier legislation introducing VAT on imported parcels under 150 euros. Following that setback, the newly formed Cabinet of Ministers submitted a revised legislative package to parliament on July 29.
IMF-linked votes in September: On Sept. 1, 2026, parliament initially rejected two tax bills tied directly to commitments under the IMF extended fund facility.
First-reading approval: On Sept. 16, 2026, the Verkhovna Rada approved the sub-150-euro parcel VAT legislation in its first reading, paving the way for the committee's final review.
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