REUTERS
The Ministry of Finance has sent for revision a law on amendments to the Tax Code regarding control of wealthy individuals’ income and the right of State Fiscal Service of Ukraine to request disclosure of information classified as bank secrets.
The relevant decision has been published on the Web site of the ministry.
"The draft law on amendments to the Tax Code of Ukraine (regarding the introduction of servicing wealthy individuals) has been withdrawn from discussion in connection with its return for revision," a statement from the Finance Ministry reads.
The bill provides for the obligation for wealthy individuals to submit an income tax return in electronic form in the same manner as major taxpayers and medium-sized businesses, while a fiscal authority may decide to change the principal place of registration of a wealthy individual.
As noted, wealthy individuals are deeemd those who meet one of the following criteria: Being the ultimate beneficiary of a large taxpayer; owning directly or indirectly 20% or more of a legal entity that is a tax resident of another state, and has declared income for the previous tax year of EUR 10 million or more; or having a total annual taxable income for the previous tax (reporting) year of more than UAH 50 million.
In addition, it was proposed to introduce a rule according to which the tax authorities have the right to additionally accrue tax with regard to wealthy individuals, with the accrual limitation period of 3,650 days, or 10 years. According to the bill, the untimely submission of tax returns by wealthy individuals will be punished by a penalty of at least 10% of the accrued tax on the income of such individuals. In addition, the Finance Ministry suggested to grant the State Fiscal Service of Ukraine the right to request the disclosing of banking secrets.
According to the State Fiscal Service of Ukraine, within the framework of the declaration campaign that began on January 1 and lasted until May 1, 683 citizens declared income above UAH 1 million, and the total declared income amounted to UAH 13.8 billion. The number of millionaires dropped by 3% compared to the previous year.
At the same time, the leadership of the Independent Association of Ukrainian Banks argues that the adoption of the bill will allow the six state governing bodies to access to information on all banking transactions of individuals, which would encourage citizens to continue withdrawing their funds from the banking system.