Partnership

Country of equal opportunities with strong economy’ Memorandum approved by the UBC and the Civil Position

The Ukrainian Business Council amounting 68 Ukrainian business associations, and the Civil Position political party made a decision to sign this Memorandum on the basis of our common vision of needs and ways of expedited economic development of Ukraine.

Our goal is to perform efficient reforms aimed at eliminating any obstacles on the way to creating equal, efficient and open opportunities for business development, and creating favourable conditions for doing business by the government (significant improvement in the Doing Business ranking), which will lead to:

1. Strengthening the economy as the basis for democracy, well-being and social standards.
2. Increasing the national capitalisation, attracting domestic and foreign investment.
3. Bringing the economy to high growth rates in compliance with environmental standards.

Efficient reforms will result in:

1. Free citizen and business owner, whose legal rights, freedoms and property are reliably protected.
2. Strong middle class and active civil society.
3. Economically strong communities and, on their basis, economically sustainable independent Ukraine.

Efficient reforms will be based on ten key principles:

1. Inviolability of property rights, resolute opposition to raiding.
2. Protection of economic rights and freedoms of citizens, both in Ukraine and abroad.
3. Demonopolisation of the economy, creation of equal conditions for fair competition.
4. Deoffshorisation and de-shadowing of economy, stimulation of non-cash transactions.
5. Decentralisation of state power, strengthening the economic base of local communities.
6. Efficient and transparent public administration, accountability of the authorities to the society.
7. State support for the development of export potential and reduction of tax-free imports of consumer goods.
8. Energy saving, energy efficiency, development of alternative energy.
9. Depoliticisation and decommercialisation of law enforcement and judicial bodies.
10. Resolute counteraction to corruption based on effective incentives and inevitability of punishment.

We believe the following to be the priority practical steps on the way to reforms:

• Creation of infrastructure for the quick development of new production, including prepared facilities with connected utilities and access to networks, and demonopolisation of railway transportation.
• Simplification of tax administration procedures; reduction of salary taxes; blocking of offshore schemes; reduction of the shadow market for land and agricultural lease; implementation of measures aimed at ensuring control over the sales chain from the producer or importer to the final sale, ensuring the de-shadowing of payments and consumer protection through adoption and implementation of legislation aimed at encouraging buyers to demand fiscal payment documents when purchasing goods; introduction of the single account concept for paying taxes and fees; introduction of personal financial liability of an official for blocking an enterprise work.
• Improvement of budgeting process aimed at introducing medium-term budgeting, limiting the government share in the GDP redistribution through the budget, reducing inefficient expenses, and eliminating corruption schemes in the public procurement system, privatisation processes and state-owned enterprises operation.
• Ensuring equal access conditions and transparent competitive procedures for privatisation of state-owned enterprises and public property.
• Improving the business climate and reducing the country risks in order to enable domestic producers to obtain affordable credit resources.
• Launching compensation (offset) schemes and localisation requirements for large-scale public procurement of goods and services abroad.
• Ensuring sustainable development of agricultural manufacturing and social life of a Ukrainian village, standardisation of land relations by 100% completion of the State Land Cadastre and its full integration with the Register of Property Rights, shifting focus of the budgetary support from the most profitable agroholdings to enhance the development of middle and small agricultural producers with high added value and high share of labour in the end product cost (meat and dairy, vegetable, fruit and berry industries, beekeeping).
• Institutional reform of the State Fiscal Service of Ukraine, holding open competitions for the State Fiscal Service and customs employees, ensuring the highest possible transparency of their activity along with the processes automation.
• Final liquidation of the tax police, deprivation of the Security Service of Ukraine, Ministry of Internal Affairs of Ukraine and other prosecution authorities of non-relevant duties and leverage of coercive intervention in economic processes, establishment of a unified civil (non-forceful) service for financial investigation.

Together we are working on the new version of the Tax Code of Ukraine (Development Code, including detailed calculations on the capital withdrawal tax) and offers regarding major improvement of the Customs Code of Ukraine to be adopted by the newly elected parliament.

We stand for political reforms that will help renew the government and increase its responsibility to society and the people, primarily the adoption of a law on impeachment of the President of Ukraine, limiting parliamentary immunity, and introducing a proportional electoral system with open lists.

Recognising the importance and urgency of efficient reforms, we agreed to provide comprehensive support in their implementation.

Together we will ensure maximum communication of the content of the Memorandum and its publication on available public resources.

The Memorandum shall come into force on the date of its signing and shall remain in force until terminated by our mutual agreement.

Amendments and alterations to the Memorandum shall be made by mutual agreement.

Ukrainian Business Council           Civil Position political party

Declaration of Intent Economic development of Ukraine

We, members of the Ukrainian Business Council, amounting 69 business associations, on the one part, and the Union ‘Self Reliance’ political party, on the other part (hereinafter the Parties), with understanding of mutual responsibility for consolidating the efforts of business owners and the state to develop a competitive economy based on civilised market relations, decided to pool our efforts to ensure sustainable economic development of the country, build an ‘open access’ society and work on tasks that will lead to creation of inclusive economic and political institutions.

Modernisation of Ukraine in all areas of social life shall be based on the following key principles:

1. deoligarchisation of the economy; decentralisation of state power; demonopolisation of the economy;
2. de-bureaucratisation;
3. deregulation;
4. tax liberalisation;
5. de-shadowing.

Key tasks to reform the country:

1. Significant update and liberalisation of tax legislation
   • Liquidation of the corporate income tax and transition to capital withdrawal tax model.
   • Reduction of burden on the wages fund with compensation by reducing inefficient budget expenses and economy de-shadowing measures.
   • Retaining the simplified taxation system for the small business development. Supporting business initiative, self-employment and strengthening the middle class as a basis for sustainable society.

These tasks can be implemented by adopting the Tax Code which will launch the investment regime of the Ukrainian economy development.

2. Institutional reform of the State Fiscal Service (hereinafter the SFS), creation of common EU-type customs administration separate from the SFS, as well as reform of law enforcement bodies and judicial system, competitive selection of chairpersons and employees of such bodies, significant increase in salary, and their personal liability for losses caused by their actions.

3. Liquidation of the tax police, economic subdivisions of the National Police, the Security Service of Ukraine, and creation of a single analytical non-repressive body of financial investigation (financial police or service for financial investigation) with advanced analytical duties of detectives and clearly defined responsibilities for investigation of crimes against the state public finance and local self-government, which will be a central executive authority coordinated by the Minister of Finance of Ukraine.

4. Reforming the budgetary process, in particular: implementation of the fiscal policy aimed at significant reduction of the share of public expenditures in GDP that are redistributed through public finance, reviewing budget expenditure items to optimise the structure and size of budget expenditures, verification of social benefits and pensions, and reduction of inefficient budget expenditures. Implementation of a responsible budget policy, ensuring the independence of the central bank.

5. Establishing an efficient comprehensive system of control over the goods supply and sales chain  from the border to end consumers, introducing efficient incentives for buyers to receive a fiscal check, including a ‘cashback for buyers’.

6. Reducing the shadow market for leasing agricultural lands and agricultural products, increasing revenues of local self-government bodies by levelling the efficient tax burden per hectare of commercial agricultural lands for legally operating and shadow agricultural producers by reducing the gap between the land tax and the single tax rates of the fourth group to 0.2%, and establishing a minimum tax base for individual income tax depending on the amount and normative monetary value of commercial land used by an individual or a legal entity that pays the individual income tax for tenants and employees as a tax agent.

7. Development and implementation of a set of measures that create the necessary basis for the land market launch, as set out in the Memorandum of Cooperation between the Self Reliance political party and the associations of the agricultural sector on reforms in agriculture and rural development. These include, but are not limited to, introducing full information to the state land cadastre and its integration with the property rights register, prevention of fraud and falsification in the registration of land ownership and use rights, and ensuring access to cheap mortgage for small and medium-sized farmers. The implementation of these measures will result in creation of the land free market, which will include both Ukrainian citizens and legal entities – agricultural producers established by them, as members of the market.

8. Amending legislation to simplify and reduce the cost of use of cash registers by business entities (hereinafter the CR), developing legislative opportunities to use online (electronic) CR, including a software which can be installed on any device (gadgets) and transmit information on a transaction to the relevant sever of the SFS. Using advance technologies and improving the electronic servers by expanding the scope of services for taxpayers in order to eliminate physical contacts of business owners with SFS officials. Implementing risk-based approach while planning the inspections.

9. Adoption of legislative initiatives for dramatically improvement of Ukraine’s position in the Doing Business rating:
   • introducing a connection market and setting the single procedure for connecting the electric grids while maintaining the current green energy tariffs with gradual reduction until 2030;
   • reform of share contribution in construction;
   • amending the Customs Code of Ukraine to introduce efficient customs post-audit control, and, once it is fully operational, implementation of the concept of authorised economic operator to improve control over the safety of goods supply chain worked out by the World Customs Organisation. An enterprise demonstrating a high level of compliance with the legislation in its activity, complies with the indicated criteria, provides the customs body with access to its records and accounting systems, and received the status of authorised economic operator, will enjoy a range of simplifications during customs clearance;
   • creating legislative prerequisites for development and facilitation of international trade, in particular, by cutting timeframe for export and import of goods in half;
   • creating legislative prerequisites for reducing the time spent by taxpayers on paying taxes and reducing the overall fiscal burden on business;
   • a single account for paying taxes and fees;
   • cancellation of price regulation for notary services;
   • Paper free – abandonment of paper atavisms (employment record books, calculation books, etc.) and transition to electronic document management (electronic CN, etc.).

10. Preventing the adoption of laws and other regulatory acts by authorities restricting the rights of business entities to carry out their business activity, creating obstacles and forwarding claims to business entities which can result in termination of their business activity.

11. Infrastructure reform, development of modern transit corridors, logistic hubs, attracting private investors to road construction, creation of competition in the railway transportation market, including the admission of private traction, cancellation of privileges for certain branches, and termination of cross subsidisation of passenger transportation at the expense of freight forwarding; construction of airports and ports in the public-private partnership format.

12. Further development of the national export strategy, creation of conditions for efficient work of the national export credit agency and providing domestic exporters with affordable loan resources. Simplification of the procedure for imposing anti-dumping duties on goods of mass-production in Ukraine.

13. Large-scale privatisation of the most state-owned enterprises except, for critical infrastructure entities, and development and implementation of a range of measures creating relevant prerequisites to launch the land market.

14. Changing the electoral system to a proportional system with open party lists.

15. Large-scale digitalisation of all branches of economy and basic areas of life, starting with education and medicine. This is the digital economy which accelerates the social and economic life of the society in the modern world and is able to dramatically increase the national GDP. Development of digital economy should become the priority for Ukraine. We must perform digital transformation of old branches and create conditions for new ones to appear. Development of digital infrastructure is the basis for the digital economy. Digitalisation of basic areas of life, including through the digital transformation of the middle school and development of STEM-education, implementation of eHealth and e-safety, ‘smart cities’ concept, as well as mandatory implementation of electronic excise stamp.

Understanding emergency and urgency of tasks set forth in the Declaration, the signatories agreed to provide overall support and cooperation in their achieving. Introduction of such reforms into the Ukrainian legislation and support for their implementation is the key priority of cooperation.

VALIDITY TERM OF THE DECLARATION OF INTENT

The Declaration of Intent shall come into force on the date of its signing by the Parties and shall remain in force until terminated by mutual agreement of the Parties.

Any amendments and alterations to the Declaration of Intent shall be made by written agreement of the Parties and become its integral part.

Any disputes regarding interpretation or application of the provisions of the present Declaration of Intent shall be settled by the Parties on a friendly basis through consultations and negotiations.

The Declaration of Intent is executed in counterparts in the Ukrainian language, one original copy for each Party.

Ukrainian Business Council               Union ‘Self Reliance’ political party

Memorandum of Cooperation

On reforms in Ukraine

We, members of the Ukrainian Business Council, amounting 75 business associations, representatives of the Economic Safety Support Fund, representatives of analytical centres and Holos political party (hereinafter the Parties), with understanding of mutual responsibility for consolidating the efforts of business owners, expert environment and the state to develop a competitive economy based on civilised market relations, decided to pool our efforts to ensure sustainable economic development of the country, build an ‘open access’ society and work on tasks that will lead to creation of inclusive economic and political institutions.

Modernisation of Ukraine in all areas of social life shall be based on the following key principles:

1. deoligarchisation of the economy;
2. decentralisation of powers;
3. demonopolisation of the economy;
4. deregulation;
5. tax liberalisation;
6. de-shadowing of the economy;
7. participatory democracy and e- governance.

Key tasks to reform the country:

Institutional reforms:

1. Establishing an independent judiciary system and prosecution service, including by judicial governance and prosecution bodies shake-up to efficiently purge and renew the personnel, ensuring public participation in judiciary proceedings, improving pre-trial investigation, including legislative regulation of private detective activities.
2. Changing the electoral system to a proportional system with open party lists.
3. Institutional reform of the State Fiscal Service and customs office, as well as reform of law enforcement bodies and judicial system, competitive selection (engaging experts from the society and business areas) of chairpersons and employees of such bodies, significant increase in salary, social protection and their personal liability for losses caused by their actions.
4. Liquidation of the tax police, economic subdivisions of the National Police, the Security Service of Ukraine, prosecution office and creation of a single analytical body of financial investigation with the involvement of public on a transparent competitive basis (financial police or service for financial investigation) with advanced analytical duties of detectives and clearly defined responsibilities for investigation of crimes against the state public finance and local self-government, which will be a central executive authority coordinated by the Cabinet of Ministers, or as independent and equally distant as can be from the government authorities.
5. Ensuring independent, efficient and professional work of all anti-corruption institutions (National Agency on Corruption Prevention, National Anti-Corruption Bureau of Ukraine, Specialized Anti-Corruption Prosecutor’s Office, High Anti-Corruption Court, Agency for Investigation and Management of Assets). In particular, restart of the National Agency on Corruption Prevention by adopting the relevant legislative amendments ensuring independent selection and activity of the NACP members, efficient management model, and return of the article of law on punishment for illicit enrichment.
6. Implementing efficient mechanisms for assessing the impact and control of legislative initiatives, including the introduction of effective mechanisms with the involvement of public (including business associations) in the public policy making and implementing.
7. Legislative support in finalising the second and third stages of the decentralisation of power reform.

Tax and budgetary policy:

1. Significant update and liberalisation of tax legislation
   • Reduction of burden on the wages fund with compensation by reducing inefficient budget expenses and economy de-shadowing measures.
   • Replacing the discretionary corporate income tax with an innovative model of capital withdrawal tax in a way that does not lead to the state budget imbalance.
   • Retaining the simplified taxation system for the small business development (along with efficient combating the abuse of the simplified taxation system schemes). Supporting business initiative, self-employment and strengthening the middle class as a basis for sustainable society.
   • Amending the tax legislation with the SFS’s obligation to take into account legal opinion on a certain dispute during the administrative appeal set forth by the business ombudsman office (or any other legally defined community of legal professionals independent of the state). In case of non-consent, an actual motive should be defined, and lack of such motive can be a separate ground for cancellation of tax notification-decision. At present, such conclusions are often ignored;
   • Accumulation and making public of legal opinions of the Supreme Court of Ukraine in terms of taxation by the Ministry of Finance of Ukraine on a regular (quarterly) basis.

These tasks can be implemented by adopting the Tax Code which will ensure term and conditions for sustainable development of the Ukrainian economy.

2. Introducing the single tax electronic document to control the supply chain of risky goods and encourage a purchaser to receive the fiscal receipt when purchasing them (cashback for customer, fiscal lotteries).

3. Reforming the budgetary process, in particular: implementation of the fiscal policy aimed at significant reduction of the share of public expenditures in theGDP that are redistributed through public finance, reviewing budget expenditure items to optimise the structure and size of budget expenditures, verification of social benefits and pensions, and reduction of inefficient budget expenditures by 37% of the GDP.

Economic policy:

1. Defining the key threats to the Ukrainian economic security and the mitigation measures plan, ensuring implementation of appropriate measures through adoption of the Doctrine of Economic Security of Ukraine and other regulatory acts.
2. Prompt and transparent privatisation of the most state-owned enterprises, except for critical infrastructure entities.
3. Reducing the shadow market for leasing agricultural lands and agricultural products, increasing revenues of local self-government bodies. Levelling the efficient tax burden per hectare of agricultural lands for legally operating and shadow agricultural producers by reducing the gap between the land tax and the single tax rates of the fourth group, and significant reduction of opportunities to avoid paying the individual tax on income gained from agricultural lands processing and encouraging its paying.
4. Infrastructure reform, development of modern transit corridors, logistic hubs, attracting private investors to road construction (concession), creation of competition in the railway transportation market, including the admission of private traction, cancellation of privileges for certain branches, and termination of cross subsidisation of passenger transportation at the expense of freight forwarding; construction of airports and ports in the public-private partnership format.
5. Development and implementation of a set of measures that create the necessary basis for the land market launch, including introducing full information to the state land cadastre and its integration with the property rights register, prevention of fraud and falsification in the registration of land ownership and use rights, and ensuring access to cheap loans for small and medium-sized farmers by attracting international donors. The implementation of these measures will result in creation of the land free market, which will include both Ukrainian citizens and legal entities – agricultural producers established by them, as members of the market.
6. Further development of the national export strategy, creation of conditions for efficient and transparent work of the national export credit agency and export incentives. Simplification of the procedure for imposing anti-dumping duties.

Administration:

1. Amending legislation to simplify and reduce the cost of use of cash registers by business entities (hereinafter the CR), developing legislative opportunities to use online (electronic) CR, including a software which can be installed on any device (gadgets) and transmit information on a transaction to the relevant sever of the SFS.
2. Using advance technologies and improving the electronic servers by expanding the scope of services for taxpayers in order to eliminate physical contacts of business owners with SFS officials. Implementing risk-based approach while planning the inspections.
3. Adoption of legislative initiatives for dramatically improvement of the business environment in Ukraine:

• setting the unified procedure for connecting the electric grids;
• reform of share contribution in construction;
• creating legislative prerequisites for development and facilitation of international trade, in particular, by cutting timeframe for export and import of goods in half;
• creating legislative prerequisites for reducing the time spent by taxpayers on paying taxes and reducing the overall fiscal burden on business;
• a single account for paying taxes and fees;
• Paper free – abandonment of paper atavisms and transition to electronic document management (electronic CN, etc.).

4. Increasing expertise in analysing the regulatory impact of regulations and ensuring maximum participation of the parties concerned at the stage of regulatory act development. Preventing adoption of regulations that set unreasonable barriers for doing business or create unequal conditions for market participants.

Financial sector:

1. Reforming the financial system of Ukraine, in particular through further liberalisation of currency regulation and development of the adopted law on currency regulation, involvement of private financial institutions in social policy, and creation of conditions for the development of equity and debt capital markets.
2. Ensuring the transition from the pay-as-you-earn pension system to the multi-level funded one.

Demonopolisation and reform of the power sector:

1. Defining cross-sectoral monopolies in the coal and electric power markets and the conditions for their forced separation, stimulating gas production and simplifying access to gas production.
2. Urgent design and construction of DC links to ensure free electricity exchange with the EU countries and restrict the monopoly on the electricity market. Adoption of legislative changes required to launch import of electricity and stimulate export. Public reporting by the Ministry of Energy and Coal Industry of Ukraine on the implementation status of measures to synchronise the power grid.
3. Ensuring the environmental friendliness of the energy sector by creating a system of public monitoring of emissions from large combustion plants, developing and implementing quotas, an emissions reduction plan, and introducing a significant environmental tax on emissions.
4. Ensuring interruptible, available and sufficient financial resources for implementation of energy-saving projects in individual and multifamily houses. Ensuring differentiation of RES projects by various criteria (including capacity). Focus on the development of distributed energy resources.

Participatory democracy and e- governance:

1. Development of mutual trust and dialogue between the national and local authorities, active, united citizens, and consolidated business in the country through the development of e-democracy tools, a culture of participatory democracy through the organisation and development of an e-democracy tools platform independent from public authorities and international donors (e-appeals, e-petitions, e-voting, e-plebiscites, participatory budgets, e-competitions, e-elections of advisory and working bodies, debates, mediation, etc. etc.). Monitoring of the national agenda and advocacy until the implementation of those issues that coincide with the views of the Parties to the Memorandum is completed.
2. Speeding up and improving the efficiency of the country’s e-development at the national and local levels by consolidating the expert environment of the IT sector, relevant business analysts, government experts, international experts, as well as developing the National Bank of IT Solutions for e-government and e-democracy, developing and promoting the IT solutions ratings, vendors, users among government agencies, forming coalitions of users and the culture of sharing the best solutions in their field, creating national standards, transparency and efficiency of the civic & gov-tech market.
3. Development of democracy, in particular, implementing the mechanism for self-defining a part of their taxes by a person to strengthen the financial independence of parties and NGOs, and development of efficient safeguards against possible abuse.
4. Online control and participation of public and consolidated business in planning and expenses of budget funds, work of subsidiries, municipal enterprises.
5. Development of democratic culture, participatory democracy and self-government, as well as e-smart development at all levels, including by establishing the network of expert centres of e-development (smart-development) on the local and national levels and in governmental bodies in partnership with business owners. Development of the relevant education, statistics and awareness-raising campaigns.
6. 6. Development of the Ukrainian Public Budget tool considering clauses 1-5 and the e-Citizen Account tool which will ensure access to all e-services of governmental authorities and system and mutual interaction. Also, informing about all requests for personal data.

Understanding emergency and urgency of tasks set forth in the Declaration, the signatories agreed to provide overall support and cooperation in their achieving. Introduction of such reforms into the Ukrainian legislation and support for their implementation is the key priority of cooperation.

VALIDITY TERM OF THE DECLARATION OF INTENT

The Declaration of Intent shall come into force on the date of its signing by the Parties and shall remain in force until terminated by mutual agreement of the Parties.

Any amendments and alterations to the Declaration of Intent shall be made by written agreement of the Parties and become its integral part.

Any disputes regarding interpretation or application of the provisions of the present Declaration of Intent shall be settled by the Parties on a friendly basis through consultations and negotiations.

The Declaration of Intent is executed in counterparts in the Ukrainian language, one original copy for each Party.

Parties:

Business association:

Ukrainian Business Council

Economic Safety Support Fund

Political party

Holos political party

Analytical centres:

Illia Neskhodovskyi, Representative of the Economic Expert Platform
Serhii Loboiko, Head of CID, co-founder of the Electronic State Coalition

Memorandum – Servant of the People

Declaration of Intent

On reforms in Ukraine

We, members of the Ukrainian Business Council, amounting 75 business associations, representatives of the Economic Safety Support Fund, representatives of analytical centres and Servant of the People political party (hereinafter the Parties), with understanding of mutual responsibility for consolidating the efforts of business owners, expert environment and the state to develop a competitive economy based on civilised market relations, decided to pool our efforts to ensure sustainable economic development of the country, build an ‘open access’ society and work on tasks that will lead to creation of inclusive economic and political institutions.

Modernisation of Ukraine in all areas of social life shall be based on the following key principles:

1. deoligarchisation of the economy;
2. decentralisation of powers;
3. demonopolisation of the economy;
4. deregulation;
5. tax liberalisation;
6. de-shadowing of the economy;
7. participatory democracy and e- governance.

Key tasks to reform the country:

Institutional reforms:

1. Establishing an independent judiciary system and efficient law enforcement services, including by High Council of Justice shake-up to efficiently purge and renew the judicial staff, ensuring public participation in judiciary proceedings, improving pre-trial investigation (including legislative regulation of private detective activities), complete and timely execution of judicial resolutions.
2. Institutional reform of the tax and customs authorities, as well as reform of law enforcement bodies and judicial system, competitive selection (engaging experts from the society and business areas) of chairpersons and employees of such bodies, significant increase in salary, as well as enhance liability for losses caused by actions of officials of such bodies.
3. Liquidation of the tax police, economic subdivisions of the National Police, the Security Service of Ukraine, prosecution office and creation of a single analytical body of financial investigation with the involvement of public on a transperant competitive basis (financial police or service for financial investigation) with advanced analytical duties of detectives and clearly defined responsibilities for investigation of crimes against the state public finance and local self-government, which will be a central executive authority coordinated by the Cabinet of Ministers, or as independent and equally distant as can be from the government authorities.
4. Ensuring independent, efficient and professional work of all anti-corruption institutions (National Agency on Corruption Prevention, National Anti-Corruption Bureau of Ukraine, Specialized Anti-Corruption Prosecutor’s Office, High Anti-Corruption Court, Agency for Investigation and Management of Assets). In particular, restart of the National Agency on Corruption Prevention by adopting the relevant legislative amendments ensuring independent selection and activity of the NACP members, efficient management model, and return of the article of law on punishment for illicit enrichment.
5. Legislative support in finalising the second and third stages of the decentralisation of power reform.

Tax and budgetary policy:

1. Significant update and liberalisation of tax legislation
   • Gradual reduction of burden on the wages fund with compensation by reducing inefficient budget expenses and economy de-shadowing measures.
   • Replacing the discretionary corporate income tax with an innovative model of capital withdrawal tax.
   • Retaining the simplified taxation system for the small business development (along with efficient combating the abuse of the simplified taxation system schemes). Supporting business initiative, self-employment and strengthening the middle class as a basis for sustainable society.

• Further amendment of Tax Code of Ukraine regarding reforms of the procedure of administrative appeal, i.e.: review of taxpayers’ complaints by the Ministry of Finance with the participation of the representatives of the Ministry of Finance, State Tax Service and business ombudsman office.

2. Introducing the electronic CN and e-receipt to control the supply chain of risky goods and encourage a purchaser to receive the fiscal receipt when purchasing them (cashback for customer, fiscal lotteries).
3. Reforming the budgetary process, in particular: implementation of the fiscal policy aimed at significant reduction of the share of public expenditures in the GDP that are redistributed through public finance, reviewing budget expenditure items to optimise the structure and size of budget expenditures, verification of social benefits and pensions, and reduction of inefficient budget expenditures by 37% of the GDP

Economic policy:

1. Defining the key threats to the Ukrainian economic security and the mitigation measures plan.
2. Prompt and transparent privatisation of the most state-owned enterprises, except for critical infrastructure entities.
3. Reducing the shadow market for leasing agricultural lands and agricultural products, increasing revenues of local self-government bodies. Levelling the efficient tax burden per hectare of agricultural lands for legally operating and shadow agricultural producers by reducing the gap between the land tax and the single tax rates of the fourth group, and significant reduction of opportunities to avoid paying the individual tax on income gained from agricultural lands processing and encouraging its paying
4. Infrastructure reform, development of modern transit corridors, logistic hubs, attracting private investors to road construction (concession), creation of competition in the railway transportation market, including the admission of private traction, cancellation of privileges for certain branches, and termination of cross subsidisation of passenger transportation at the expense of freight forwarding; construction and reconstruction of airports and ports in the public-private partnership format.
5. Development and implementation of a set of measures that create the necessary basis for the land market launch, including introducing full information to the state land cadastre and its integration with the property rights register, prevention of fraud and falsification in the registration of land ownership and use rights, and ensuring access to cheap loans for small and medium-sized farmers by attracting international donors. The implementation of these measures will result in creation of the land free market, which will include both Ukrainian citizens and legal entities – agricultural producers established by them, as members of the market.
6. Further development of the national export strategy, creation of conditions for efficient and transparent work of the national export credit agency and export incentives. Simplification of the procedure for imposing anti-dumping duties.

Adnimistration:

1. Amending legislation to simplify and reduce the cost of use of cash registers by business entities (hereinafter the CR), developing legislative opportunities to use online (electronic) CR, including a software which can be installed on any device (gadgets) and transmit information on a transaction to the relevant sever of the State Tax Service.
2. Using advance technologies and improving the electronic servers by expanding the scope of services for taxpayers in order to eliminate physical contacts of business owners with officials of the State Tax Service. Implementing risk-based approach while planning the inspections.
3. Adoption of legislative initiatives for dramatically improvement of the business environment in Ukraine:

• setting the unified procedure for connecting the electric grids;
• reform of share contribution in construction;
• creating legislative prerequisites for development and facilitation of international trade, in particular, by cutting timeframe for export and import of goods in half;
• creating legislative prerequisites for reducing the time spent by taxpayers on public payments and reducing the overall fiscal burden on business;
• a single account for paying taxes and fees;
• Paper free – відмова від паперових атавізмів та перехід на електронний документообіг (електронна ТТН та інше).

4. Increasing expertise in analysing the regulatory impact of regulations and ensuring maximum participation of the parties concerned at the stage of regulatory act development. Preventing adoption of regulations that set unreasonable barriers for doing business or create unequal conditions for market participants.
5. Providing a taxpayer with the right to allocate 1% of their individual income tax to finance NGOs financing at their own discretion.

Financial sector:

1. Reforming the financial system of Ukraine, in particular through further liberalisation of currency regulation and development of the adopted law on currency regulation, denationalisation of the social insurance contribution fund and involvement of private financial institutions in social policy, regulating bill of exchange transactions in Ukraine in line with the European exchange law to ensure the small and medium-sized businesses have access to finance at a lower cost than loans by intensifying bill of exchange settlements, and creating conditions for the development of equity and debt capital markets
2. Ensuring the transition from the pay-as-you-earn pension system to the multi-level funded one.
3. Introducing insurance medicine.

Demonopolisation and reform of the power sector:

1. Defining cross-sectoral monopolies in the coal and electric power markets and the conditions for their forced separation, stimulating gas production and simplifying access to gas production.
2. Urgent design and construction of DC links to ensure free electricity exchange with the EU countries and restrict the monopoly in the electricity market. Adoption of legislative changes required to launch import of electricity and stimulate export. Public reporting by the Ministry of Energy and Coal Industry of Ukraine on the implementation status of measures to synchronise the power grid.
3. Ensuring the environmental friendliness of the energy sector by creating a system of public monitoring of emissions from large combustion plants, developing and implementing quotas, an emissions reduction plan, and introducing a significant environmental tax on emissions.
4. Ensuring interruptible, available and sufficient financial resources for implementation of energy-saving projects in individual and multifamily houses. Ensuring differentiation of RES projects by various criteria (including capacity). Focus on the development of distributed energy resources.

Participatory democracy and e- governance:

1. Development of mutual trust and dialogue between the national and local authorities, active, united citizens, and consolidated business in the country through the development of e-democracy tools, a culture of participatory democracy through the organisation and development of an e-democracy tools platform independent from public authorities and international donors (e-appeals, e-petitions, e-voting, e-plebiscites, participatory budgets, e-competitions, e-elections of advisory and working bodies, debates, mediation, etc. etc.). Monitoring of the national agenda and advocacy until the implementation of those issues that coincide with the views of the Parties to the Declaration is completed.
2. Speeding up and improving the efficiency of the country’s e-development at the national and local levels by consolidating the expert environment of the IT sector, relevant business analysts, government experts, international experts, as well as developing the National Bank of IT Solutions for e-government and e-democracy, developing and promoting the IT solutions ratings, vendors, users among government agencies, forming coalitions of users and the culture of sharing the best solutions in their field, creating national standards, transparency and efficiency of the civic & gov-tech market.
3. Online control and participation of public and consolidated business in planning and expenses of budget funds, work of subsidiries, municipal enterprises. In particular, through the possibility to check the implementation of selected budget items, programmes and budget estimates; through the possibility to check – for consolidated businesses or the public involved in supporting the public budget projects –activity of any key spending units, the efficiency and fairness of the calculation and administration of taxes and fees, etc.
4. Development of democratic culture, participatory democracy and self-government, as well as e-smart development at all levels, including by establishing the network of expert centres of e-development (smart-development) on the local and national levels and in governmental bodies in partnership with business owners. Development of the relevant education, statistics and awareness-raising campaigns.

Understanding emergency and urgency of tasks set forth in the Declaration, the signatories agreed to provide overall support and cooperation in their achieving. Introduction of such reforms into the Ukrainian legislation and support for their implementation is the key priority of cooperation.

 

VALIDITY TERM OF THE DECLARATION OF INTENT

The Declaration of Intent shall come into force on the date of its signing by the Parties and shall remain in force until terminated by mutual agreement of the Parties.

Any amendments and alterations to the Declaration of Intent shall be made by written agreement of the Parties and become its integral part.

Any disputes regarding interpretation or application of the provisions of the present Declaration of Intent shall be settled by the Parties on a friendly basis through consultations and negotiations.

The Declaration of Intent is executed in five original copies in the Ukrainian language, one original copy for each Party.

 

Parties:

Business association:

Ukrainian Business Council

Grigol Katamadze,

President of the Association of Taxpayers of Ukraine, member of the Supervisory Board,

 

Ukrainian Economic Safety Support Fund

Viktor Ivanchyk

CEO of Astarta-Kyiv,

Member of the Supervisory Board

---

SERVANT OF THE PEOPLE political party

Dmytro Razumkov,

Head of the political party

---

Analytical centres:

Economic Expert Platform

Illia Neskhodovskyi,

Director of the Institute of Social and Economic Transformation

 

Co-founder of the Electronic State Coalition, Director of the Center for Innovations Development

Serhii Loboiko