The issue of introducing VAT for sole proprietors has been postponed for the time being. Finance Minister Serhiy Marchenko said this during government question time, according to a broadcast of the session.
Answering a question from MP Yaroslav Zheleznyak, Marchenko said it remains important to pass a bill abolishing preferential customs clearance for parcels. He expressed hope that it would receive parliamentary support.
“It needs to be considered, and I hope that MPs will also find an opportunity to actively discuss this issue,” he said.
Marchenko recalled that these changes are required not only under Ukraine’s programme with the IMF but also under other international commitments.
“As for small businesses and economic entities that currently do not pay value-added tax, this issue has been postponed. The further timeline for putting it to a vote will be determined depending on the available opportunities, including the situation at the front,” the minister said.
Marchenko also stated that the government has submitted all documents necessary for the International Monetary Fund’s Executive Board meeting.
“A board meeting on 20 July is currently being considered. All documents and everything necessary from the government and the president have been completed so that we receive the funds following the first review of the programme,” he said.
Context
- The requirement for sole proprietors to pay VAT was previously presented as an IMF condition for concluding a new cooperation programme worth $8.1 billion.
- According to Economichna Pravda, the government held consultations with sole proprietors on the proposed VAT legislation.
- Initially, officials considered imposing VAT on all businesses with annual income starting from one million hryvnyas. Later, discussions shifted towards raising the threshold to 2 million hryvnyas.
- On 14 February, it became known that the government planned to introduce a 20% VAT rate for sole proprietors with annual income of at least 4 million hryvnyas. The International Monetary Fund subsequently agreed to Ukraine’s revised proposal.
- In March, parliament reported that MPs were not yet ready to support the relevant bill.