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Digital solutions will simplify tax accounting and reporting for business

13/ 05/ 2021
  Currently, Ukraine ranks 64th in the World Banks Doing Business ranking. It is worth noting that the business community is interested in expanding the range of measures on deregulation of economic activity and improvement of the business climate, to increase Ukraines position in the World Banks Doing Business ranking. First of all, it concerns the modernization and simplification of requirements for tax accounting and reporting. Given that Ukraine has taken a course on the digital transformation and digitalization of administrative services, the European Business Association proposes to make more efficient use of existing electronic databases of regulatory authorities and eliminate duplication of information (repeated requests for the same information in different reports). Besides, it is necessary to foster wider use of electronic reporting forms and primary accounting forms with digital signatures. For this purpose, the business suggests the following first steps: Removing the manual data entry in the tax reporting, except for one identifier by which the system will recognize the taxpayer; Reducing the number of similar declarations (informative notifications under Form 20-OPP) that enterprises have to submit few times a year, the number of indicators to be filled in by payers, and the number of additional documents. Establishing a regular exchange of administrative data between public authorities (automatic data entry in the tax reporting that can be obtained from other authorities, such as the register of vehicles or real estate). Simplifying obsolete paper forms of accounting, in particular, advance reports and methods of storing primary documents related to them. Practical experience shows that the storage of scanned copies of checks is more durable than with the use of the cash register. The use of simple digital signatures, which make it possible to identify a person, would greatly simplify and speed up all business processes in Ukraines economy. To date, there are no official clarifications and case law on the use of simple electronic signatures generated on well-known international platforms such as Docusign, Hellosign, and similar. Accordingly, there may be conflicts over the recognition by the supervisory authorities of primary accounting documents signed with such a simple electronic signature, used for tax, accounting, and reporting, as well as for banking operations; Simplifying the requirements for the notification of objects of taxation or objects related to taxation or which are engaged in activities provided by Form №20-OPP. This form of notification has become a means of terror for companies and the rapid budget replenishment at the cost of penalties for incomplete data or errors in filling out the form; Simplifying value-added tax administration. The rules and forms of filling in declarations, tax invoices, adjustment calculations, and tables of information to them should be clearly comprehensible both to taxpayers of all regions of Ukraine and accountants of companies. The service function of the tax service should be developed more successfully. According to EBA experts, the implementation of initiatives, related to the large-scale transition to digital technologies, will not only facilitate the reporting process but also provide an opportunity for Ukraine to improve its position in the Doing Business ranking. Thus, the European Business Association appealed to the Ministry of Economic Development, Trade and Agriculture of Ukraine with a request to facilitate the implementation of the EBA initiatives. Our experts are ready to join the work to develop legislative changes to deregulate the business. Therefore, we call on the authorities to engage in dialogue and develop a unified position on this issue.   Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.  

Currently, Ukraine ranks 64th in the World Bank’s Doing Business ranking.

It is worth noting that the business community is interested in expanding the range of measures on deregulation of economic activity and improvement of the business climate, to increase Ukraine’s position in the World Bank’s “Doing Business” ranking. First of all, it concerns the modernization and simplification of requirements for tax accounting and reporting.

Given that Ukraine has taken a course on the digital transformation and digitalization of administrative services, the European Business Association proposes to make more efficient use of existing electronic databases of regulatory authorities and eliminate duplication of information (repeated requests for the same information in different reports). Besides, it is necessary to foster wider use of electronic reporting forms and primary accounting forms with digital signatures. For this purpose, the business suggests the following first steps:

  • Removing the manual data entry in the tax reporting, except for one identifier by which the system will recognize the taxpayer;
  • Reducing the number of similar declarations (informative notifications under Form 20-OPP) that enterprises have to submit few times a year, the number of indicators to be filled in by payers, and the number of additional documents.
  • Establishing a regular exchange of administrative data between public authorities (automatic data entry in the tax reporting that can be obtained from other authorities, such as the register of vehicles or real estate).
  • Simplifying obsolete paper forms of accounting, in particular, advance reports and methods of storing primary documents related to them. Practical experience shows that the storage of scanned copies of checks is more durable than with the use of the cash register. The use of simple digital signatures, which make it possible to identify a person, would greatly simplify and speed up all business processes in Ukraine’s economy. To date, there are no official clarifications and case law on the use of simple electronic signatures generated on well-known international platforms such as Docusign, Hellosign, and similar. Accordingly, there may be conflicts over the recognition by the supervisory authorities of primary accounting documents signed with such a simple electronic signature, used for tax, accounting, and reporting, as well as for banking operations;
  • Simplifying the requirements for the notification of objects of taxation or objects related to taxation or which are engaged in activities provided by Form №20-OPP. This form of notification has become a means of terror for companies and the rapid budget replenishment at the cost of penalties for incomplete data or errors in filling out the form;
  • Simplifying value-added tax administration. The rules and forms of filling in declarations, tax invoices, adjustment calculations, and tables of information to them should be clearly comprehensible both to taxpayers of all regions of Ukraine and accountants of companies. The service function of the tax service should be developed more successfully.

According to EBA experts, the implementation of initiatives, related to the large-scale transition to digital technologies, will not only facilitate the reporting process but also provide an opportunity for Ukraine to improve its position in the “Doing Business” ranking. Thus, the European Business Association appealed to the Ministry of Economic Development, Trade and Agriculture of Ukraine with a request to facilitate the implementation of the EBA initiatives. Our experts are ready to join the work to develop legislative changes to deregulate the business.

Therefore, we call on the authorities to engage in dialogue and develop a unified position on this issue.

 

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

 

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