The National Bank of Ukraine by Resolution No. 195 of December 28, 2023 “On Amendments to Resolution of the Board of the National Bank of Ukraine No. 18 of February 24, 2022” relaxes a number of restrictions for the population and businesses in order to simplify the receipt of monetary assistance by Ukrainians, increase opportunities for export and import of electricity, as well as to ensure compliance with the rights of foreigners regarding medical care in Ukraine.
Thus, from December 29, 2023:
- the payment service providers will be able to pay monetary aid from international humanitarian organizations and other non-governmental institutions to Ukrainians who suffered as a result of a full-scale war, based on the Certificate of Submission of Documents for the Registration of a Passport of a Citizen of Ukraine. The changes concern cash payments in the national currency of Ukraine.
Previously, it was possible to receive assistance by a natural person only on the basis of a passport of a citizen of Ukraine or another document certifying identity that can be used to conclude transactions on the territory of Ukraine;
- the Ukrainian operator of the electric energy transmission system (NPC Ukrenergo) was given the opportunity to transfer funds to the European office for the distribution of capacity of interstate crossings Joint Allocation Office (JAO) for carrying out a joint coordinated allocation of capacity.
The corresponding changes will contribute to ensuring the import of electricity in sufficient quantities in the event of damage to the energy infrastructure of Ukraine as a result of attacks by Russia, as well as the export of electricity in the event of its surplus in Ukraine;
- the list of exceptions to the ban on spending transactions on the accounts of residents of the Russian Federation and the Republic of Belarus, who are legally present on the territory of Ukraine, was supplemented with transactions for the payment of medical services in health care institutions.
The President of Ukraine has signed Law No. 3513-IX of December 9, 2023 “On Amendments to the Criminal and Criminal Procedure Codes of Ukraine on the Criminalization of Smuggling of Goods”.
It recalls that at the last moment amendments were made to the Law, which the business insisted on:
1) thresholds for goods smuggling are proposed to be raised five times;
2) thresholds for excise goods – twice;
3) entry into force of the commodity law is postponed until the middle of 2024. This is the IMF's deadline to reset the Economic Security Bureau;
4) taking into account the numerous insistences of the business regarding the indication of the intent as a form of guilt, only in the presence of which actions can be qualified as a crime;
5) significantly limited the possible cases of prosecution for “contraband” articles for submitting documents with false information. In the amended version, they must be the basis for the movement of goods, must be subject to mandatory declaration in accordance with customs legislation, and also have an impact on determining the size customs payments or compliance with measures of non-tariff regulation.
The Cabinet of Ministers of Ukraine has approved the Plan of measures aimed at preventing the occurrence and reducing the negative consequences of risks identified as a result of the third national risk assessment in the field of prevention and countermeasures against the legalization (laundering) proceeds from crime, terrorist financing and financing of proliferation of weapons of mass destruction, for the period until 2026.
With this decision, the Cabinet of Ministers has determined the main national vectors of the development of the financial monitoring system with the key directions of state policy in this area for the next three years.
The action plan has been formed based on the results of the third National Risk Assessment, which identified relevant threats (vulnerabilities) for subjects of financial monitoring.
At the same time, minimizing the threats of money laundering and terrorist financing requires targeted and coordinated efforts of all participants in the financial monitoring system.
The approved Action Plan envisages institutional, legislative, organizational and practical improvement of the national system of combating “dirty” money laundering in accordance with international standards.
The measures are divided into groups, for each of which the executors and the deadline are fixed, in order to cover all components of the national financial monitoring system, namely:
- improving the legislation in the field of financial monitoring;
- improving the activities of state financial monitoring entities and other bodies;
- increasing the effectiveness of law enforcement and other state bodies;
- ensuring openness of information about the ultimate beneficial owners of legal entities;
- international cooperation, etc.
The implementation of this government document will contribute to the improvement of the legislation and the practice of its application in accordance with international standards and the introduction by Ukraine of new mechanisms to combat “dirty” money laundering.
The Cabinet of Ministers of Ukraine has increased the terms and amounts of providing employers with compensation for labor costs for the employment of internally displaced persons and internally displaced persons with disabilities. This decision was made at a meeting of the Cabinet of Ministers on December 27.
The government has increased the total duration of providing compensation for expenses from two to three months to an employer for the employment of internally displaced persons (IDPs) and to six months for the employment of IDPs from among persons with disabilities. The amount of compensation will also change. If earlier they were paid the amount of UAH 6,700 per month, then from now on such compensations will be tied to the amount of the minimum salary, which will be UAH 7,100 from January 1, and UAH 8,000 from April 1.
The National Bank of Ukraine has expanded the list of suspicious signs for which banks may refuse to carry out a currency transaction.
This is stated in Resolution No. 160 of December 14, 2023 “On Amendments to the Regulation on the Procedure for Analysis and Verification of Documents (Information) on Currency Transactions by Authorized Institutions”.
According to the document, a new sign of suspicious financial transactions is the presence of changes or additional conditions to foreign economic contracts, which provide for an increase in the terms of delivery of goods by a non-resident counterparty. In this case, the bank has the right to refuse the currency transaction.
The regulator added two more new indicators: exceeding the deadline for settlement of export-import operations in the amount of UAH 8 million or more (20 threshold amounts for financial monitoring) and fixing during the year repeated payments from a non-resident counterparty in favor of bank clients of more than 50% of prepayments for operations import of goods.
In addition, such factors as violation of settlement terms for export-import operations of goods, creation of confusing or artificial conditions for making payments, and the presence of legal restrictions on the import of goods into the territory of Ukraine remain valid.
The Cabinet of Ministers of Ukraine has adopted the resolution approving the Procedure for the operation of the State online monitoring system. The procedure defines the rules of operation, the list of users and the scope of access rights for various users of the State system, as well as the procedure for its interaction with the organizers of gambling games and Commission for Regulation of Gambling and Lotteries.
In addition, the document establishes the structure of the State System, requirements for authorization and protection of information processed in it.
The approval of the Procedure is the first step towards the construction of an important IT solution in the field of gambling regulation. After all, the Procedure for the functioning of the State Online Monitoring System is a regulatory and legal basis for the creation of the State System, which will help:
- control the financial circulation of money in the field of gambling;
- receive or transmit information in real time from the relevant gaming equipment;
- receive and store information about accepted bets, paid winnings, made payments and other operations;
- protect information from loss, theft, distortion, forgery, unauthorized actions regarding its destruction, modification and copying.
That is, such a system will make it possible to stop tax evasion and ensure the implementation of the Principles of Responsible Gaming.
The President of Ukraine has signed the Law of Ukraine “On Amendments to the Law of Ukraine “On Financial Mechanisms for Stimulating Export Activities”. The document expands the capabilities of the Export Credit Agency.
According to bill No. 9015, the document eliminates restrictions on the possibility of insuring domestic investments by the Export Credit Agency (ECA), including in the conditions of military operations and post-war reconstruction.
Currently, ECA insures export contracts and has the right to insure investments from Ukraine to other countries. It is planned that the agency will insure investments in Ukraine against risks that may be caused by armed aggression, hostilities and/or terrorism.
It is assumed that such insurance will cover investments aimed at creating facilities and infrastructure necessary for the development of the processing industry and the export of goods of Ukrainian origin.
This bill:
- will help put Ukrainian investors on the same terms as foreign investors, who currently have the opportunity to insure their investments in export credit agencies of their countries or similar international organizations, including against military risks;
- will simplify and speed up the project selection process, because MIGA and DFC, which have announced similar intentions, do not have representative offices in Ukraine. And in Ukraine, the Export Credit Agency can perform this work, working as an agent for them or independently insure and transfer risks related to such investment projects to reinsurance;
- will provide access to insurance to medium-sized companies that are unlikely to be of interest to international insurers, but instead fully meet the profile of the Export Credit Agency of Ukraine.
The Cabinet of Ministers of Ukraine has approved the National Revenue Strategy for 2024-2030. This is a plan for changes in the tax and customs sphere and administration until 2030, which should ensure more own revenues of the state budget.
The government plans to seek new revenues in the following sectors.
- Customs policy:
- harmonization with the EU of preferential import taxation
- restoration of documentary checks
- implementation of the EU Customs Code
- provision of customs authorities with the right to operational investigative activity and pre-trial investigation into smuggling
- administrative responsibility for violations of customs rules and implementation of norms on the criminalization of smuggling
- Reform of the DPS and the State Customs Service is planned.
- Tax policy:
- review simplified taxation system;
- progressive scale of personal income tax (PIT);
- reduction of tax benefits, in particular for income tax;
- gradual increase of excise duties to EU minimum rates.
- Changes to business income tax.
Here the National Strategy proposes:
- to allow payers to deduct the entire value of the purchased asset at once (instant full depreciation). The regime of investment incentives is planned to be reviewed in order to cancel income tax benefits;
- to consider the possibility of limiting their volume to a percentage of tax liabilities for potential sectoral subsidies in the future;
- to bring the rules of corporate taxation in accordance with EU directives: on dividends, interest payments and royalties and rules on taxation in the event of a merger, division, transfer of assets for companies from different EU member states, as well as anti-tax evasion regulations.
- Reform of the simplified taxation system
The document provides for gradual changes from 2025 to 2027. And besides, they still have to finish the administrative changes planned in the strategy.
What will change.
For legal entities of groups 3 and 4:
- a three-year transitional period, when the rate will gradually increase to ordinary income tax. Upon completion, legal entities will not be able to apply the simplified system.
For individual entrepreneurs of groups 2 and 3:
- there will be one united group
- rates will vary from 3% for trade to 17% for some services. They will rise gradually.
- mandatory cash register (classical or software)
For individual entrepreneurs of the 1st group:
- limited list of activities
- tax on received income, not fixed
- Personal income tax
The main proposal of the National Revenue Strategy regarding personal income tax is a progressive scale of taxation. For high incomes, there will be another one or two higher rates.
In addition:
- personal social assistance instead of the minimum tax-free income
- revision of personal income tax benefits and exclusions
- revision of the system for refunding a part of taxes from some expenses (education of children, starting a business, etc.)
Changes are planned only after changes in the administration and reform of the simplified taxation system. And just as gradual for three years.
