Business calls for revising the Concept of the Bureau of Economic Security

29/ 09/ 2020

Yesterday, the Verkhovna Rada Committee on Financial, Tax, and Customs Policy considered and approved amendments to the draft law №3087-d on the Bureau of Economic Security for voting for it in the 2nd reading. At the same time, the European Business Association once again emphasizes the need to revise the concept of creating a new body to investigate economic crimes. According to business, the norms of the draft law contradict the main declared areas of the government’s activity: simplification of doing business and inadmissibility of pressure on business entities. Thus, yesterday People Deputies agreed with the need to remove from the draft law odious articles on changes in the Criminal and Criminal Procedure Codes of Ukraine regarding VAT refunds. Particularly, such legislative changes would allow initiating criminal proceedings only upon the fact of determining the offense by an act of inspection, which is inadmissible. After all, the tax legislation provides the possibility of administrative and judicial appeal of an act of documentary inspection, and the facts stated in it can’t be considered established until all procedures for appealing such an act have been passed. In addition, the proposed amendments to the Criminal Code allowed for a broad interpretation of taxpayers actions regarding the provision of knowingly false information by the investigative authorities and left much room for public authorities to possible abuse of power and pressure on taxpayers. In practice, however, the tax authorities often make a decision on non-reimbursement of VAT, so taxpayers are forced to go to court to protect their rights and refund VAT. The previous version of the draft law allowed to initiate criminal proceedings against the companys management only on the basis of the fact of filing an application for compensation and the decision of the tax authorities to refuse compensation for consideration of the dispute in court on the merits. However, business reiterates that the draft law leaves a large number of odious articles on the use of firearms by the BES (Bureau of Economic Security) employees and state awards in the form of weapons. The business community considers it necessary to withdraw this draft law. Other comments from the business can be found via the link. Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.

At the same time, the European Business Association once again emphasizes the need to revise the concept of creating a new body to investigate economic crimes. According to business, the norms of the draft law contradict the main declared areas of the government’s activity: simplification of doing business and inadmissibility of pressure on business entities.

Thus, yesterday People Deputies agreed with the need to remove from the draft law odious articles on changes in the Criminal and Criminal Procedure Codes of Ukraine regarding VAT refunds. Particularly, such legislative changes would allow initiating criminal proceedings only upon the fact of determining the offense by an act of inspection, which is inadmissible. After all, the tax legislation provides the possibility of administrative and judicial appeal of an act of documentary inspection, and the facts stated in it can’t be considered established until all procedures for appealing such an act have been passed.

In addition, the proposed amendments to the Criminal Code allowed for a broad interpretation of taxpayers’ actions regarding the “provision of knowingly false information” by the investigative authorities and left much room for public authorities to possible abuse of power and pressure on taxpayers. In practice, however, the tax authorities often make a decision on non-reimbursement of VAT, so taxpayers are forced to go to court to protect their rights and refund VAT.

The previous version of the draft law allowed to initiate criminal proceedings against the company’s management only on the basis of the fact of filing an application for compensation and the decision of the tax authorities to refuse compensation for consideration of the dispute in court on the merits.

However, business reiterates that the draft law leaves a large number of odious articles on the use of firearms by the BES (Bureau of Economic Security) employees and state awards in the form of weapons. The business community considers it necessary to withdraw this draft law. Other comments from the business can be found via the link.

Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.