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Annually, due to smuggling and “gray imports”, the state budget of Ukraine does not receive billions of hryvnias in taxes and customs duties, meanwhile, law-abiding businesses suffer significant reputational and economic losses due to goods illegally imported to the Ukrainian market. Therefore, the European Business Association has been long advocating for an effective fight against smuggling and shadow schemes at customs.<\/p>\n
Currently, the Verkhovna Rada has registered draft law \u21165420 on the criminalization of smuggling of goods and excisable goods, as well as the inaccurate declaration of goods.<\/p>\n
Given the current situation on the tobacco market in Ukraine, EBA member companies support the establishment of criminal liability for the smuggling of excisable goods. International experience in combating the smuggling of goods shows the lack of effectiveness of the application of purely economic measures to combat their illegal movement across the customs border, and therefore it is common practice to apply criminal liability for such offenses. Thus, criminal liability for tobacco smuggling is envisaged at the level of EU legislation.<\/p>\n
At the same time, draft law \u21165420 proposes to set unacceptably low thresholds for criminal prosecution for smuggling, and technical errors, such as the one that implies criminal liability for wrongly entering information in certain columns of the customs declaration.<\/p>\n
Also, this draft law entrusts control to the not yet established Bureau of Economic Security, and for the period of its establishment, the tax police will perform that function. At the same time, the tax police remain unreformed and bear a negative reputation. According to EBA companies, imperfect rules of draft law \u21165420, when applied by the tax police, can lead to gross abuse and even greater pressure on the business.<\/p>\n
Thus, law enforcement agencies will have the right to determine at their discretion the moment when “actions aimed at transporting goods\/excisable goods out of customs control or with concealment from customs control” begin in accordance with Articles 201, 201-1 and 305 of the current Criminal Code of Ukraine and Articles 201-2, 201-3 of the Criminal Code of Ukraine. Thus, even if the company does not transport goods across the customs border, and the goods are, for example, in a warehouse – law enforcement agencies can visit to check and classify this situation as “actions aimed at transporting goods\/ excisable goods out of customs control”, even when the company did not intend to transport the goods.<\/p>\n
This draft law was initiated by the President of Ukraine. It was also supported by the relevant Parliamentary Committee on Law Enforcement. At the same time, when considering the draft law, the Verkhovna Rada Committee on Finance, Tax, and Customs Policy provided a number of comments and recommended that the relevant Parliamentary Committee take them into account when revising the draft law.<\/p>\n
For its part, the European Business Association also submitted proposals to the draft law, namely, regarding the removal or substantial revision of the article on false declarations, and appealed to the Verkhovna Rada and Speaker of the Verkhovna Rada \u2013 Mr. Dmytro Razumkov to take into account the community’s proposals. After all, it is important to create a truly effective system that will protect the rights of law-abiding businesses, and not put pressure on entrepreneurs.<\/p>\n
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