Raising taxes in Ukraine must be accompanied by the fight against the shadow, otherwise it may have the opposite effect. In addition, the local authorities should “forget” about the fact that at the expense of income from personal income tax, they arrange landscaping: spend money on paving stones and flowers.
This was agreed upon during a meeting of representatives of the government headed by Prime Minister Denys Shmyhal, OPU, Council Committee on Finance, Tax and Customs Policy with business. As the Chairman of the Council of the Federation of Employers of Ukraine, Dmytro Oliinyk, wrote on his Facebook page, the meeting lasted 2.5 hours instead of the planned 1.5 hours.
Defense Minister Rustem Umyerov spoke about the army’s need for additional financing in the amount of UAH 500 billion.
“We understand that without financing the army, there will be no victory. But when the economy collapses, then victory is also impossible. We asked to pay attention to costs, control and tenders,” Oliinyk said.
Business representatives also proposed to reduce the level of shadow, namely to solve the following issues:
- unpaid excise tax (tobacco, alcohol, oil products)
- contraband at customs
- frauds with VAT
- salaries in envelopes
- tax evasion through other mechanisms, including the use of FOPs by large companies
“If taxes are increased, and the shadow remains, then the effect will be the opposite. Honest taxpayers will not be able to compete with those who do not pay taxes. The budget may gain something in the short term, and then lose it, because the economy will fall,” says Oliinyk.
During the meeting, business representatives also noted that importers in the country “live better than exporters. And the balance of the trade balance is critically negative.” “On the negative side, there is no time. The army needs finances. On the positive side, we agreed to hold meetings, hold discussions, and listen to each other. The next conversation will be in the VRU committee on finance, tax and customs policy. The chairman of the committee was also present. We have one country. We will do everything necessary for victory. The strong Armed Forces of Ukraine are a strong economy of Ukraine,” wrote the head of the Federation of Employers.
First of all, it is about increasing the military levy, as well as expanding its use. In fact, the 1.5% military levy is part of the personal income tax. If now Ukrainians pay a tax of 19.5% of their income (of which 1.5% is a military levy), then after the tax increase they will have to pay 23% (of which 5% is a military levy).
