The EU is demanding tax reforms as a condition for granting a loan to Ukraine
The list of reforms that Ukraine must implement to receive funding from the European Union includes changes to the tax system, specifically the introduction of VAT for sole proprietors and the taxation of parcels. The loan for Ukraine is to be disbursed in three tranches, but the timing of these disbursements will depend on the fulfillment of the established conditions and the progress of the reforms.
This is reported with reference to the text of the Memorandum of Understanding between Ukraine and the EU, which has been submitted to the Verkhovna Rada for ratification.
"Condition 2.3: Adoption by the Verkhovna Rada of a law abolishing the tax exemption for international parcels, with the exception of goods intended for security and defense purposes," the document states.
This condition must be met to receive the second loan tranche.
"Condition 3.2: Adoption by the Verkhovna Rada of a law simplifying VAT administration for individual entrepreneurs (quarterly reporting instead of monthly, monthly tax invoices instead of daily; preparation of a preliminary tax return for individual entrepreneurs; simplification of the process for unblocking tax invoices)," the memorandum states.
The VAT condition must be met to receive the third tranche.
The document also includes a condition regarding the taxation of digital platforms. To receive the first tranche, a draft law on the introduction of taxation of income received through digital platforms must be submitted to the Rada.
The macro-financial assistance is divided into three tranches: €3.2 billion, €3.7 billion, and €1.45 billion. Specific deadlines for disbursement have not been set—this will depend on the fulfillment of the program’s conditions.
Individual entrepreneurs must pay all taxes by March 20: details.
Sole proprietors who have losttheir businesses due to the war may apply for compensation.
Small businesses in Ukraine are facing serious difficulties due to Russia’s frequent attacks on energy infrastructure, which cause prolonged power, water, and heat outages during the winter season at temperatures of −20 °C.
