EBA proposes changes to the “White Business Club” criteria for agro and telecom sectors

14/ 03/ 2025

Listen to online Stop   At the end of 2024, the State Tax Service of Ukraine established a List of Taxpayers with a High Level of Voluntary Compliance with Tax Legislation. Companies included in the List benefit from a new simplified tax administration concept and interaction procedures with the tax authorities. According to the European Business Association’s Tax Index survey, 46% of respondents expressed interest in joining the List but raised concerns regarding the selection criteria. The EBA notes that several well-established companies with years of experience in the Ukrainian market, particularly in the agricultural and telecommunications sectors, have been excluded from the List due to imperfections in the selection criteria. This is despite their high level of tax compliance and fulfillment of their tax obligations. EBA experts advocate for refining the existing criteria, including amendments to the Tax Code, to ensure that bona fide taxpayers can be included in the List. Specifically, the EBA proposes changes that would distinguish between isolated accidental errors and deliberate violations more clearly. Additionally, EBA suggests modifying the tax payment level criterion by using a weighted average indicator instead of the arithmetic mean. Furthermore, businesses propose introducing a 10% threshold for outstanding transactions, recognizing that even compliant exporters may face delays in foreign currency settlements. They also suggest allowing a one-time change of a company’s primary business activity without losing its compliant taxpayer status within 12 months, considering market fluctuations, restructuring, or economic shifts. The mentioned sectors play a crucial role in Ukraine’s economy. According to the Ministry of Agrarian Policy, in the past year, the agricultural sector generated nearly $24.7 billion in export revenue, accounting for 59% of the country’s foreign currency earnings. Agricultural exports significantly contribute to economic stability, job creation, budget revenues, infrastructure recovery, and social programs. Despite shelling and power outages, telecom companies continue to provide uninterrupted connectivity. In just the first half of 2024, revenue from electronic communication services reached UAH 52.4 billion. EBA member companies have reached out to the Ministry of Finance, the State Tax Service of Ukraine, and the Verkhovna Rada’s Committee on Finance, Tax, and Customs Policy with a proposal to review and refine the selection criteria and make the necessary amendments to the Tax Code. The EBA business community remains open to dialogue and is ready to engage in expert discussions to develop necessary changes that will ensure proper conditions for doing business.

At the end of 2024, the State Tax Service of Ukraine established a List of Taxpayers with a High Level of Voluntary Compliance with Tax Legislation. Companies included in the List benefit from a new simplified tax administration concept and interaction procedures with the tax authorities.

According to the European Business Association’s Tax Index survey, 46% of respondents expressed interest in joining the List but raised concerns regarding the selection criteria.

The EBA notes that several well-established companies with years of experience in the Ukrainian market, particularly in the agricultural and telecommunications sectors, have been excluded from the List due to imperfections in the selection criteria. This is despite their high level of tax compliance and fulfillment of their tax obligations.

EBA experts advocate for refining the existing criteria, including amendments to the Tax Code, to ensure that bona fide taxpayers can be included in the List. Specifically, the EBA proposes changes that would distinguish between isolated accidental errors and deliberate violations more clearly. Additionally, EBA suggests modifying the tax payment level criterion by using a weighted average indicator instead of the arithmetic mean.

Furthermore, businesses propose introducing a 10% threshold for outstanding transactions, recognizing that even compliant exporters may face delays in foreign currency settlements. They also suggest allowing a one-time change of a company’s primary business activity without losing its compliant taxpayer status within 12 months, considering market fluctuations, restructuring, or economic shifts.

The mentioned sectors play a crucial role in Ukraine’s economy. According to the Ministry of Agrarian Policy, in the past year, the agricultural sector generated nearly $24.7 billion in export revenue, accounting for 59% of the country’s foreign currency earnings. Agricultural exports significantly contribute to economic stability, job creation, budget revenues, infrastructure recovery, and social programs.

Despite shelling and power outages, telecom companies continue to provide uninterrupted connectivity. In just the first half of 2024, revenue from electronic communication services reached UAH 52.4 billion.

EBA member companies have reached out to the Ministry of Finance, the State Tax Service of Ukraine, and the Verkhovna Rada’s Committee on Finance, Tax, and Customs Policy with a proposal to review and refine the selection criteria and make the necessary amendments to the Tax Code.

The EBA business community remains open to dialogue and is ready to engage in expert discussions to develop necessary changes that will ensure proper conditions for doing business.