Draft Law No. 15111-d: Taxation of Digital Platform Earnings
Ukraine’s parliament, the Verkhovna Rada, has approved draft law No. 15111-d in its second reading and as a whole, targeting income generated through digital platforms. The decision received 241 votes in favor. This new legislation establishes tax rules for earnings from ride-hailing services, food delivery, short-term rentals, online marketplaces, and other internet-based platforms.
Key Provisions of the Law
Starting January 1, 2027, platforms will automatically withhold a 10% tax on individuals’ income. Notably, the military levy will not apply to these earnings. The law also sets a tax-free threshold for goods sales at €2,000 per year, with no limit on the number of transactions. These rules will apply to both Ukrainian and foreign companies offering the relevant services.
According to available data, roughly 400,000 Ukrainians earn income through such services. The draft law was designed to implement the model rules of the Organisation for Economic Co-operation and Development (OECD) and align with the EU’s DAC7 directive. These tax changes were a requirement from the International Monetary Fund and the European Union, which insisted on introducing the new framework.
This legislative move marks a significant step in regulating economic relations within Ukraine’s digital technology sector. The introduction of these tax norms aims to ensure fairness and transparency in financial transactions conducted across various platforms.
The approval of this bill could boost Ukraine’s digital economy by creating clear market rules and potentially attracting investment. Automating tax withholding will also simplify tax administration, likely improving compliance among taxpayers. This measure is part of a broader reform of Ukraine’s tax system, aligning it with international standards.
As the Ukrainian government moves forward with the implementation of this tax framework, the support from the business sector has been significant. This backing highlights the potential for enhanced regulatory clarity within the digital economy. For a deeper insight on how this legislation is being embraced by the business community, you can read more about the reception of the digital platform taxation bill.