Ukraine postponed the VAT reform for entrepreneurs: what is known about the timelines

Mandatory VAT registration for some entrepreneurs in the simplified system will not start in 2027. Ukraine plans to adopt the relevant changes by the end of April 2027 and implement them from January 1, 2028. Reports MP Yaroslav Zheleznyak.

VAT for entrepreneurs: what exactly has been postponed to 2028

This is not about a new tax for all entrepreneurs, but about the cancellation of the VAT exemption for taxpayers in the simplified system whose turnover exceeds the general threshold for VAT registration.

The document does not specify the exact amount of this threshold. At the same time, the government plans to raise it but not above the limits set by EU legislation. Specific rules will be defined by future legislation.

The reason for the postponement was the concerns of small businesses about the complexity of VAT accounting. The additional year is intended for the government to simplify administration and increase trust in the State Tax Service.

Simplified system for entrepreneurs: what changes are being prepared

In parallel, in 2027, separate changes to the rules of the single tax are planned to be submitted. They may include the exclusion of certain types of activities from the second group and transferring such taxpayers to the third.

For third group entrepreneurs providing services, the memorandum mentions differentiated rates of the single tax that may reach 10%. However, the list of professions and the final rates have not yet been approved.

By the end of 2026, the government also has to submit rules against abuses of the simplified system. In particular, they should limit artificial fragmentation of business, returning to the simplified system after transitioning to the general system, and disguising labor relations as cooperation with entrepreneurs.

What this means for entrepreneurs now

Currently, the rules for entrepreneurs have not changed: the law on mandatory VAT registration has not yet been adopted. Therefore, it is too early to talk about specific taxes, new limits, or mandatory actions today.

MP Yaroslav Zheleznyak in a video on the channel «Iron MP» drew attention that the idea of the reform has not been canceled, only postponed. The key for businesses will be the text of the draft law, which will show who exactly will be affected by the new requirements and how the transition period will work.

Earlier, Zheleznyak announced a crackdown on corrupt officials due to EU requirements and 90 billion euros.