To the Chairman of the Economic Committee,
To the Chairman of the Tax Committee,
To the Chairman of the Social Policy Committee,
To the Minister of Finance of Ukraine,
To the Minister of Economy of Ukraine,
To the Minister of Digital Transformation,
Members of the Coalition Ukrainian Business Council, which comprises 110 business associations from various sectors of the economy, extend their respects and address you as follows:
Experts of the Ukrainian Business Council have thoroughly analyzed draft laws No. 9569 and No. 9570 and note that these drafts are inexpedient in the current conditions. Their implementation would worsen the administration of the Unified Social Tax (UST) and lead to increased expenditures for the Pension Fund.
At present, the State Tax Service of Ukraine has information technology systems that handle tax payer records, electronic reporting, accounting of accrued and paid amounts, legal support, taxpayer consultation, and other administrative processes. This system operates efficiently and fulfills its designated functions.
Therefore, the provisions of draft laws No. 9569 and No. 9570, which propose transferring the functions of administering the Unified Social Tax from the State Tax Service to the Pension Fund of Ukraine, are unclear. The Pension Fund lacks the corresponding information infrastructure (automated systems). The explanatory memorandum does not include any calculations or arguments that would substantiate claims of the current system’s inefficiency, so the implementation of these provisions appears unsubstantiated.
Even more perplexing are the provisions of these drafts, considering that after the end of the state of war, government representatives declared the consolidation of UST, personal income tax, and military duty into a single tax and a reduction in the burden on the payroll fund. Given this, it would be sensible at this time to reduce the functions and expenditures of the Pension Fund and gradually transform it into a department of the Ministry of Social Policy.
The Ukrainian business community calls on Members of Parliament and the Cabinet of Ministers to refrain from passing laws without any substantiation, similar to No. 9569 and No. 9570. We urge an analysis of the costs and benefits of such changes, obtaining an assessment of the drafts from the Ministry of Finance, Ministry of Economy, and Ministry of Digital Transformation, and based on this information, to conduct an open expert discussion of drafts No. 9569 and No. 9570 involving key stakeholders. The results of this discussion should determine the expediency of such changes.
With respect,
Business Associations
Members of the Ukrainian Business Council