The Ministry of Finance of Ukraine has put forward a draft law for public discussion aimed at improving VAT administration for single tax payers. The new regulations are planned to be introduced from 2027 so that all parties can adequately prepare for the historic changes.
The main goal of the draft law is to ensure equal conditions for all participants in the game. It is planned to implement restrictions for shadow businesses and imports to protect law-abiding entrepreneurs.
“We understand that changes in tax legislation always raise questions. Therefore, we emphasize that the new rules will only come into effect from 2027,” it is emphasized in the official statement of the Ministry of Finance.
Main innovations of the draft law
- Time for preparation. The law will only come into force at the beginning of 2027 so that businesses and authorities can calmly adapt to new requirements.
- Changes for the 3rd group. Exceeding income for the 3rd group over 1 million hryvnias per year will subject the taxpayer to VAT taxation at a reduced rate of 3%.
- Exemption for e-residents. They are not required to register as VAT payers if they belong to the 3rd group.
- Digitalization and simplification. Registration and reporting will be conducted online through the “Electronic Cabinet” for the convenience of taxpayers.
Purpose of changes in taxation
The main goals include ensuring fairness among all players, combating smuggling, and funding the Armed Forces of Ukraine. It is projected that this could additionally provide about 40 billion hryvnias in annual revenue to the budget for defense needs.
The official text of the draft law and documentation is available on the Ministry of Finance's website for review. All interested parties are invited to submit their proposals for the joint construction of a transparent and stable economy.