Taxes, Customs

19/ 04/ 2014

Due to the efforts of the European Business Association (hereinafter – the Association) on 19 April 2014 the Law of Ukraine “On Amendments to the Tax Code of Ukraine and Other Legislative Acts of Ukraine concerning Elimination of Certain Inconsistencies in Legislation” No1200-VII dated 10 April 2014 (hereinafter – Law No1200 -VII) came into force and clarified, among others, the following problematic questions, namely:

– use of official exchange rates while calculating customs liabilities;
– determination of the tax base for goods imported via international postal and express deliveries;
– introduction of a transitional period for re-programing cash registers used by the sellers and distributors of medicines and medical devices.

Background: On 1 April 2014, the Law of Ukraine “On Prevention of the Financial Disaster and Creation of the Conditions for Economic Growth in Ukraine” No1166-VII, dated 27 March 2014, entered into force. Immediately after, the Association on behalf of its member-companies, systematically and insistently focused our attention on certain imperfections in the adopted changes and difficulties with their practical execution.

We are glad to announce that Law No1200-VII resolved a number of controversial issues and harmonized the provisions of current legislation acts concerning:

– application of official exchange rates while calculating customs liabilities: Law No1200-VII clarified that the official rate of Ukrainian hryvnya to foreign currencies, stated by the National Bank of Ukraine, valid at 00:00 time of day, when the customs declaration was submitted, should be applied with the aim to determine customs liabilities;
– the tax base for the goods imported into the customs territory of Ukraine via international postal and express deliveries: Law No1200-VII harmonized provisions of Sub-paragraph 191.1.1. Paragraph 191.1. Article 191 of the Tax Code of Ukraine No2755 -VI dated 2 December 2010 with norms of Articles 234 and
374 of the Customs Code of Ukraine No4495-VI dated 13 March 2012;
– introduction of a transitional period (from 1 April 2014 until 1 June 2014) for the payers of value added tax (hereinafter – VAT), who use the 7 percent rate for supplying medicines and medical devices, while the information concerning: the code of VAT rate for the sales unit; the total amount of VAT sums for each group of goods; and the total sum paid by the customers (including VAT) won’t be reflected in the bills of sale.

The Association would like to express our gratitude to the legislative and executive branches of state power for their constructive cooperation, prompt amendments to the current legislation of Ukraine and consideration of the Association’s comments, as well as to all member-companies for their active positions and persistence in solving the problematic aspects.

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