The Verkhovna Rada of Ukraine adopted the Law of Ukraine “On Amendments to the Tax Code of Ukraine on the abolition of taxation of income received by non-residents in the form of payment for production and/or distribution of advertising and improvement of the taxation procedure for value-added tax transactions for the supply of electronic services by non-residents to individuals” (so called Google Tax Act).
The Law is aimed at increasing the revenues of the State Budget of Ukraine from value added tax (hereinafter – VAT) by adding non-residents who provide electronic services to individuals, whose supply is located in the customs territory of Ukraine to VAT taxation, and creating favorable conditions for efficient and burdensome administration for business and the state of procedures related to tax payment.
The Law supplements the Tax Code of Ukraine with norms on abolition of taxation of income received by non-residents in the form of payment for production and/or distribution of advertising, and norms on improvement of value added tax procedure for transactions on supply of electronic services by non-residents to individuals.
The Law, in particular:
- cancels the rule according to which residents must pay tax at the rate of 20% of the amount of such payments at their own expense when paying income to non-residents for the production and / or distribution of advertising;
- defines the documents certifying the fact of supply of services, compiled in electronic form, the date of such document is the date of such electronic document;
- defines the list of electronic services;
- exempts from VAT the supply of electronic services by providing access to electronic educational (training) resources within the provision of educational services;
- includes non-residents in the list of persons registered as value added tax payers;
- establishes rules for determining the place of supply of electronic services (B2C);
- establishes the form and determines the procedure for sending a tax notice to a non-resident and a complaint against such a decision;
- establishes a simplified procedure for VAT payer registration for non-resident suppliers, which can be carried out remotely in electronic form on a specially developed web portal;
- defines the rules of tax accounting for value added tax for non-residents who provide electronic services to individuals, the place of supply of which is located in the customs territory of Ukraine;
- releases a non-resident from the obligation to register tax invoices;
- provides payment of tax liability for a non-resident in foreign currency.
The new Law will affect non-residents who provide electronic services to individuals through Ukraine via the Internet, mobile applications, TV sets (Smart TVs), other digital devices (except for certain transactions) and do not have permanent offices in our country.
The Verkhovna Rada of Ukraine adopted in the second reading Draft No. 2051-1 “On restricting the circulation of plastic bags in Ukraine”, according to which shops and supermarkets will no longer offer the most harmful to the environment and human health plastic bags, as when ordering eating takeouts or buying medicine at the pharmacy.
Ultralight plastic bags and light plastic bags up to 50 microns thick will be banned in Ukraine. This can be the case, for example, with small transparent T-shirt bags, which people use in unlimited quantities in stores. Typically, such packages have a wall thickness of 10.2 μm. They tear quickly and are not actually recyclable. The same applies to T-shirt packages, which are distributed at the checkout. Their wall thickness varies, depending on the retail network, from 24.8 to 50 μm.
Oxo-degradable (oxo-biodegradable) plastic bags are also prohibited.
As an exception, only the primary packaging for meat, fish and products, as well as bulk products, will remain in circulation. These are ultra-light plastic bags with a wall thickness of up to 15 μm and size of 225×345×450 mm.
All restrictions will be introduced gradually. Retailers, caterers and service providers will have time to adapt to change. In particular:
- nine months from the date of adoption of the bill to refuse to distribute plastic bags with a wall thickness of up to 50 μm (thin);
- until January 1, 2022 to stop the distribution of oxo-degradable (oxo-biodegradable) plastic bags;
- until 2023, the restrictions will not apply to biodegradable plastic bags and ultra-thin plastic bags, which are the primary packaging for fresh fish and meat, products from them, as well as bulk products, ice.
Shops, supermarkets, restaurants, cafes and pharmacies should completely switch to safer alternatives for the environment and human health:
- reusable bags and pouches;
- paper bags;
- biodegradable packages.
Businesses are required to dispose of all packages that have been banned but remain in circulation.
Those who continue to distribute packages will be fined from UAH 1,700 to UAH 3,400. You will have to pay from UAH 3,400 to UAH 8,500 for a repeated violation.
The State Labor Service of Ukraine (hereinafter – the State Labor Service), summarizing the results of inspections, identified the most common mistakes among employers:
- payment of salaries is made in violation of the terms established by part one of Art. 115 of the Labor Code and Part 1 of Art. 24 of Law of Ukraine No. 108, namely later than seven days after the end of the period for which the payment is to be made. Such a violation is present in almost every second business entity (Part 1 of Art. 115 of the Labor Code);
- salaries to employees for the entire period of annual leave are paid later than three days before the leave (Part 4 of Art. 115 of the Labor Code);
- an employment contract concluded for an indefinite period is terminated by the employee in the absence of a written warning of the owner or authorized body two weeks prior (Part 1 of Art. 38 of the Labor Code);
- in the case of dismissal of employees, the payment of all amounts due to them from the enterprise, institution, organization, is not made on the day of dismissal. In connection with the non-payment of due amounts to the dismissed person during the dismissal within the terms specified in Art. 116 of the Labor Code, due to the fault of the owner or authorized body, the latter did not pay the average salary for the entire period of delay until the day of actual settlement (Art. 116, 117 of the Labor Code);
- untimely submission of a notification to the State Tax Service on hiring an employee (Resolution of the Cabinet of Ministers No. 413);
- employees are not acquainted with the rules of internal labor regulations at the enterprise (Art. 29 of the Labor Code);
- salary indexation is not carried out (Art. 95 of the Labor Code);
- employees have not been notified two months prior about a change in significant working conditions (Art. 32 of the Labor Code);
- holiday, overtime and night are not paid in accordance with current legislation (Art. 106, 107, 108 of the Labor Code);
- vacation schedules are not drawn up at enterprises (Art. 79 of the Labor Code);
- work on weekends is carried out without the permission of the elected body of the primary trade union organization (trade union representative) (Art. 71 of the Labor Code);
- the employer does not provide reliable accounting of the work performed by the employee (Art. 30 of the Labor Code);
- employment record book is not issued to the employee on the day of dismissal (Art. 47 of the Labor Code);
- leave without pay is more than 15 calendar days a year (Art. 84 of the Labor Code);
- employees work overtime more than 120 hours a year (Art. 65 of the Labor Code);
- temporary disability benefits to insured persons working on the terms of an employment contract, on other grounds provided by law, are not paid in the nearest period after the day of appointment of benefits, set for the payment of salaries.
