EBA supports the initiative to tax income from digital platforms but calls for further refinement

13/ 05/ 2025

The draft law No. 13232 has been registered in the Verkhovna Rada of Ukraine introducing amendments to the Tax Code of Ukraine and other legislative acts regarding the implementation of international automatic exchange of information on income received through digital platforms. This initiative had previously received the Government’s approval. The European Business Association had the opportunity to work with the Ministry of Finance of Ukraine during the preparation of this draft law and supports its overall concept. The draft law aims to harmonize national tax legislation with European standards, particularly the DAC7 Directive and OECD rules on reporting obligations for digital platform operators. The EBA is grateful for the partial inclusion of business proposals concerning simplified administration for individuals who have conducted no more than three transactions within a reporting year, amounting to no more than EUR 2,000 in the hryvnia equivalent. This aligns with European practices, particularly the provisions of the DAC7 Directive. At the same time, given the significant impact of the proposed tax changes on the business environment, EBA experts highlight several aspects that still require improvement. Regulation of tax payment and transaction reporting According to the EBA’s experts, it is important to introduce a requirement to monitor and report all transactions, including those made in cash, to ensure fair and equal tax conditions for all market participants, minimize tax gaps, and prevent tax evasion. In addition, the business community proposes to postpone the application of penalties for submitting inaccurate or incorrect reporting information for one year from the date the law comes into force. This would support the establishment of effective interaction between platform operators and tax authorities and reduce financial and administrative burdens at the initial stage of implementing the reporting system. Status of self-employed individuals and companies facilitating their activities EBA experts believe it is necessary to clearly define in legislation the special status of individuals who operate through a platform without registering as entrepreneurs, in order to ensure legal clarity and avoid the risk of reclassification of such individuals as employees. To prevent difficulties in registering a special taxpayer status for individuals and concerns regarding banking secrecy, the business community suggests either enabling special accounts to be opened at Ukrainian banks or making such registration possible via the state “Diia” service. The business community is convinced that implementing these changes will enhance tax transparency for actors in the digital economy. Expanding reporting obligations and introducing mandatory tax control will help eliminate gaps in tax evasion—particularly in relation to cash transactions—which is in the shared interest of transparent businesses in Ukraine. Establishing a clear taxation model will minimize the risk of ambiguous interpretation of tax obligations and ensure predictability for both businesses and the state. The EBA emphasizes that strengthening oversight mechanisms for digital platforms and introducing automatic tax data exchange should promote a fair competitive environment and foster the development of responsible business. The European Business Association hopes that the proposals provided by the business community will be taken into account during the refinement of the draft law and remains open to cooperation aimed at improving tax administration.

The European Business Association had the opportunity to work with the Ministry of Finance of Ukraine during the preparation of this draft law and supports its overall concept. The draft law aims to harmonize national tax legislation with European standards, particularly the DAC7 Directive and OECD rules on reporting obligations for digital platform operators.

The EBA is grateful for the partial inclusion of business proposals concerning simplified administration for individuals who have conducted no more than three transactions within a reporting year, amounting to no more than EUR 2,000 in the hryvnia equivalent. This aligns with European practices, particularly the provisions of the DAC7 Directive.

At the same time, given the significant impact of the proposed tax changes on the business environment, EBA experts highlight several aspects that still require improvement.

Regulation of tax payment and transaction reporting

According to the EBA’s experts, it is important to introduce a requirement to monitor and report all transactions, including those made in cash, to ensure fair and equal tax conditions for all market participants, minimize tax gaps, and prevent tax evasion.

In addition, the business community proposes to postpone the application of penalties for submitting inaccurate or incorrect reporting information for one year from the date the law comes into force. This would support the establishment of effective interaction between platform operators and tax authorities and reduce financial and administrative burdens at the initial stage of implementing the reporting system.

Status of self-employed individuals and companies facilitating their activities

EBA experts believe it is necessary to clearly define in legislation the special status of individuals who operate through a platform without registering as entrepreneurs, in order to ensure legal clarity and avoid the risk of reclassification of such individuals as employees.

To prevent difficulties in registering a special taxpayer status for individuals and concerns regarding banking secrecy, the business community suggests either enabling special accounts to be opened at Ukrainian banks or making such registration possible via the state “Diia” service.

The business community is convinced that implementing these changes will enhance tax transparency for actors in the digital economy. Expanding reporting obligations and introducing mandatory tax control will help eliminate gaps in tax evasion—particularly in relation to cash transactions—which is in the shared interest of transparent businesses in Ukraine. Establishing a clear taxation model will minimize the risk of ambiguous interpretation of tax obligations and ensure predictability for both businesses and the state.

The EBA emphasizes that strengthening oversight mechanisms for digital platforms and introducing automatic tax data exchange should promote a fair competitive environment and foster the development of responsible business.

The European Business Association hopes that the proposals provided by the business community will be taken into account during the refinement of the draft law and remains open to cooperation aimed at improving tax administration.