Made in Ukraine policy contradicts fiscal obstacles from State Tax Service, Economic Security Bureau – expert
The Made in Ukraine initiative of the Ministry of Economy, created to support Ukrainian production, contradicts fiscal obstacles from the State Tax Service, the Economic Security Bureau and the current practice of blocking value added tax (VAT), believes economic expert, PhD in public administration Yuriy Havrylechko.
"We have a rather unfortunate situation here, that anyone who starts using the opportunities of this program, or applies for a loan, or, God forbid, starts any relations with the state regarding the National Cashback program - that's where problems begin, because this enterprise, as a budget recipient, immediately begins to be examined under the microscope by various state bodies, even if it's absolutely pittance," he said during a press conference entitled "VAT is trap for manufacturers: promises of State Tax Service, reality of ESB, policy of Economy Ministry " at the press center of Interfax-Ukraine.
Havrylechko added that in fact, blocking tax invoices stops the activities of the domestic manufacturer, who decided to take advantage of this government initiative.
He also emphasized that currently there are not so many individual entrepreneurs who use VAT. "Our government officials want there to be more of them. But then Ukraine as a whole is exposed to a large number of lawsuits to the European Court of Human Rights regarding the violation of Article 7 of the European Convention on Human Rights. There is no punishment without a law, the entrepreneur did not violate any law, and blocking a tax invoice is a punishment," the expert explained.
In addition, he noted that in order to improve the situation, the government could repeal Resolution No. 1165 on the suspension of registration of tax invoices/calculations of adjustments in the Unified Register of Tax Invoices or adopt a draft prepared by public organizations to replace this resolution, develop a procedure and method for the State Tax Service to act in certain cases, or it can completely stop the practice of blocking VAT.
Regarding what other policies prevent the unblocking of VAT, Havrylechko noted that the problem lies in the approach according to which something can be blocked bypassing the judicial system. According to him, this applies not only to the tax sphere.
In turn, economic expert Pavlo Sebastianovych emphasized that 24,000 enterprises out of 85,000 registered in Ukraine were affected by the blocking of tax invoices, which means that their activities were stopped.
