Myths and fakes about fiscalization and the use of software PTR

06/ 11/ 2020

Listen to online Stop   There has been a lot of speculation recently about the entry into force of Laws 128-IX and 129-IX, which were adopted by the Verkhovna Rada and signed by the President late last year to de-shadow trade. These laws provide for many positive innovations, such as a cashback mechanism for consumers, the ability to use software payment transaction registers in a smartphone. At the same time, they should guarantee the creation of civilized and equal rules of doing business, post-expansion of the mandatory use of cash registers or their analogs, as well as increasing responsibility for failure to issue a fiscal check to the consumer, including the abolition of a fine of 1 hryvnia. Meanwhile, opponents of fiscalization are currently actively bombarding social networks and the media with unfounded and blatantly untrue allegations that mislead ordinary Ukrainians and intimidate small businesses. So, lets take a closer look at some of these myths and find out how much of a grain of truth they contain. Laws №128 and 129 force absolutely all sellers, including old grannies who sell vegetables at the market, to use cash registers. This is not true, as Article 9 of  Law on the use of PTRs clearly states that cash registers or their software analogs are not used in the sale of products of their own production, as well as in the sale of food or industrial goods for cash in the markets. Moreover, the same article allows businesses on the 1st group of the simplified taxation system not to implement PTRs. This category includes the entrepreneurs who are engaged in the sale of retail goods from outlets in the markets or provide household services to the public, and whose income during the year does not exceed 1 million hryvnias. There are rumors that there is a businessman close to the authorities who bought a million cash registers, and now, with Laws №128 and №129, wants to force all entrepreneurs to buy them overpriced by 200%. This is not true, as Laws № 128-IX and 129-IX generally allow the use of any gadget available to the seller instead of a cash register, such as a mobile phone, laptop, or tablet. Therefore, anyone can download free software from the State Tax Service to their mobile phone and use it as a cash register. There is also another businessman who bought a million printers to print fiscal checks for software PPOs, and now also wants to sell them. The software PTR automatically generates an electronic check and transmits it to the tax server, as well as to the consumers smartphone. Therefore, it is not necessary to print a check when using the software PTR. If the seller still wants to issue a paper check, it can be printed even on a regular printer, or a special mini printer rented for 50 hryvnias per month. Free software PTR from the Tax Service does not work, while analogs offered by commercial entities are very expensive. The rule on the use of software PTRs entered into force on August 1, 2020, and as of the end of October, according to the Tax Service, altogether 1959 entities have already registered 42 thousand software PTRs. During this time, they sent about 40 million checks for registration to the fiscal server. It is true that free software PTRs from the State Tax Service do not work perfectly, but today there are many inexpensive software PTRs from private companies, which installation and maintenance cost is about 140 hryvnia per month. You can install the software PTR in a few hours and continue to use them freely. Moreover, we can predict that with the further development of this technology, soon, all online programs in which the business operates will have an element of fiscalization. It is very difficult to work with the software PTR, and accounting of goods, so another professional accountant needs to be hired. No accountant is needed. All accounting in the software PTR has been performed automatically. Moreover, the software PTR will give an even greater impetus to businesses to go out and work online. After all, before, for example, it was unclear how to integrate online sales with the physical cash register and part of the business simply decided not to sell online. Now, to fiscalize online transactions, it is enough to register your cash register and all transactions are automatically fiscalized. At the same time, such PTRs works automatically 24/7. There is no need to train cashiers, monitor cash discipline, etc. Software PTRs cannot be used in Ukraine, as in some places there are interruptions in 24/7 access to the Internet. The software PTRs enable the registration of settlement transactions even without Internet access and a delayed transfer of information to a non-tax server after the Internet connection in the smartphone or laptop is renewed. Laws № 128 and 129 is a part of the government’s plan to kill small businesses in Ukraine. Thus, Laws № 128 and 129 are, first of all, an attempt to create civilized and European conditions for doing business in Ukraine, to differentiate really small entrepreneurs from certain powerful organized businesses that use the scheme with private individuals to evade taxes. For example, in Poland, a host of thousands of Ukrainian workers, the PTRs are mandatory for everyone, and entrepreneurs work under equal game rules and pay the necessary taxes to the state budget. This allows the economy to develop normally and pay decent wages, pensions, build quality roads, and invest in social infrastructure. Moreover, only this year the state has significantly increased the income limits for businesses that want to be on the simplified taxation system. For example, the limits for the first group were increased from 300 thousand to 1 million hryvnias, and the second and third groups can now be entrepreneurs with incomes up to 5 and 7 million hryvnias per year, respectively. Laws № 128 and 129 are the laws of inequality, and the rule on cashback will be used by unfair competitors to destroy each others businesses. Unscrupulous competitors have always had the opportunity to write complaints against competitors under the cover of consumers, therefore, nothing has changed in this way, and no new mechanism of pressure on entrepreneurs is introduced. At the same time, the rule on cashback, which should come into force on January 1, 2021, can significantly improve the situation with consumer protection in Ukraine. Thus, it is assumed that the consumer will be able to receive the so-called cashback or compensation for the value of the goods purchased if he finds that he was given a fake fiscal check and accordingly complained to the tax office, and the latter confirmed the violation. Now is not the best time to introduce full-scale fiscalization given the economic situation induced by COVID-19. Yes, the situation with COVID-19 is unprecedented and negatively affects the economic situation, businesses, and industries. At the same time, there is never a right and appropriate time to implement unpopular reforms. The adoption of Laws 128 and 129 is not the first attempt to de-shadow Ukraines economy. Previous attempts have been undermined by certain interest groups who are unwilling to pay taxes and work according to common European rules in Ukraine. And every time we were given arguments on why the changes are not on time right now, and things should be left as they are. However, it is impossible to constantly postpone unpopular decisions, because transparent business is gradually losing patience. So, we hope that a step forward will be taken and the reform will continue.   Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.  

There has been a lot of speculation recently about the entry into force of Laws 128-IX and 129-IX, which were adopted by the Verkhovna Rada and signed by the President late last year to de-shadow trade. These laws provide for many positive innovations, such as a cashback mechanism for consumers, the ability to use software payment transaction registers in a smartphone. At the same time, they should guarantee the creation of civilized and equal rules of doing business, post-expansion of the mandatory use of cash registers or their analogs, as well as increasing responsibility for failure to issue a fiscal check to the consumer, including the abolition of a fine of 1 hryvnia.

Meanwhile, opponents of fiscalization are currently actively bombarding social networks and the media with unfounded and blatantly untrue allegations that mislead ordinary Ukrainians and intimidate small businesses. So, let’s take a closer look at some of these myths and find out how much of a grain of truth they contain.

1. Laws №128 and 129 force absolutely all sellers, including old grannies who sell vegetables at the market, to use cash registers.

This is not true, as Article 9 of  Law on the use of PTRs clearly states that cash registers or their software analogs are not used in the sale of products of their own production, as well as in the sale of food or industrial goods for cash in the markets. Moreover, the same article allows businesses on the 1st group of the simplified taxation system not to implement PTRs. This category includes the entrepreneurs who are engaged in the sale of retail goods from outlets in the markets or provide household services to the public, and whose income during the year does not exceed 1 million hryvnias.

2. There are rumors that there is a “businessman close to the authorities” who bought a million cash registers, and now, with Laws №128 and №129, wants to force all entrepreneurs to buy them overpriced by 200%.

This is not true, as Laws № 128-IX and 129-IX generally allow the use of any gadget available to the seller instead of a cash register, such as a mobile phone, laptop, or tablet. Therefore, anyone can download free software from the State Tax Service to their mobile phone and use it as a cash register.

3. There is also another “businessman” who bought a million printers to print fiscal checks for software PPOs, and now also wants to sell them.

The software PTR automatically generates an electronic check and transmits it to the tax server, as well as to the consumer’s smartphone. Therefore, it is not necessary to print a check when using the software PTR. If the seller still wants to issue a paper check, it can be printed even on a regular printer, or a special mini printer rented for 50 hryvnias per month.

4. Free software PTR from the Tax Service does not work, while analogs offered by commercial entities are very expensive.

The rule on the use of software PTRs entered into force on August 1, 2020, and as of the end of October, according to the Tax Service, altogether 1959 entities have already registered 42 thousand software PTRs. During this time, they sent about 40 million checks for registration to the fiscal server.

It is true that free software PTRs from the State Tax Service do not work perfectly, but today there are many inexpensive software PTRs from private companies, which installation and maintenance cost is about 140 hryvnia per month. You can install the software PTR in a few hours and continue to use them freely. Moreover, we can predict that with the further development of this technology, soon, all online programs in which the business operates will have an element of fiscalization.

5. It is very difficult to work with the software PTR, and accounting of goods, so another professional accountant needs to be hired.

No accountant is needed. All accounting in the software PTR has been performed automatically. Moreover, the software PTR will give an even greater impetus to businesses to go out and work online. After all, before, for example, it was unclear how to integrate online sales with the physical cash register and part of the business simply decided not to sell online. Now, to fiscalize online transactions, it is enough to register your cash register and all transactions are automatically fiscalized. At the same time, such PTRs works automatically 24/7. There is no need to train cashiers, monitor cash discipline, etc.

6. Software PTRs cannot be used in Ukraine, as in some places there are interruptions in 24/7 access to the Internet.

The software PTRs enable the registration of settlement transactions even without Internet access and a delayed transfer of information to a non-tax server after the Internet connection in the smartphone or laptop is renewed.

7. Laws № 128 and 129 is a part of the government’s plan to kill small businesses in Ukraine.

Thus, Laws № 128 and 129 are, first of all, an attempt to create civilized and European conditions for doing business in Ukraine, to differentiate really small entrepreneurs from certain powerful organized businesses that use the scheme with private individuals to evade taxes. For example, in Poland, a host of thousands of Ukrainian workers, the PTRs are mandatory for everyone, and entrepreneurs work under equal game rules and pay the necessary taxes to the state budget. This allows the economy to develop normally and pay decent wages, pensions, build quality roads, and invest in social infrastructure.

Moreover, only this year the state has significantly increased the income limits for businesses that want to be on the simplified taxation system. For example, the limits for the first group were increased from 300 thousand to 1 million hryvnias, and the second and third groups can now be entrepreneurs with incomes up to 5 and 7 million hryvnias per year, respectively.

8. Laws № 128 and 129 are the laws of “inequality”, and the rule on “cashback” will be used by unfair competitors to destroy each other’s businesses.

Unscrupulous competitors have always had the opportunity to write complaints against competitors under the cover of consumers, therefore, nothing has changed in this way, and no new mechanism of pressure on entrepreneurs is introduced. At the same time, the rule on “cashback”, which should come into force on January 1, 2021, can significantly improve the situation with consumer protection in Ukraine. Thus, it is assumed that the consumer will be able to receive the so-called “cashback” or compensation for the value of the goods purchased if he finds that he was given a fake fiscal check and accordingly complained to the tax office, and the latter confirmed the violation.

9. Now is not the best time to introduce full-scale fiscalization given the economic situation induced by COVID-19.

Yes, the situation with COVID-19 is unprecedented and negatively affects the economic situation, businesses, and industries. At the same time, there is never a right and appropriate time to implement unpopular reforms. The adoption of Laws 128 and 129 is not the first attempt to de-shadow Ukraine’s economy.

Previous attempts have been undermined by certain interest groups who are unwilling to pay taxes and work according to common European rules in Ukraine. And every time we were given arguments on why the changes are not on time right now, and things should be left as they are.

However, it is impossible to constantly postpone unpopular decisions, because transparent business is gradually losing patience. So, we hope that a step forward will be taken and the reform will continue.

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