Ukraine Planning To Ease Regulatory Burden
It’s quite a feat on the tax front that war-torn Ukraine has a substantially better tax system than Brazil, according to Paying Taxes. But at 107th in the league table, it is an understatement to suggest that there is still ample room for improvement. But, unlike Brazil, Ukraine is at least making an attempt to remedy the problem. The launch of a public consultation on the state of the tax system, intended to supply the Government with ideas on how things can be improved, is the latest in a number of recent initiatives designed to ease the country’s tax and regulatory burden. Other examples include the launch of a new customs management system earlier this month, the creation of an expert working group on tax reform in June, and the approval of draft tax administrative reforms in April, aimed at bringing about structural reform in the State Fiscal Service, in line with changes proposed by the International Monetary Fund.
Ukraine may be pulling out all the stops to make its tax regime more friendly for investors. But it certainly doesn’t lack for friends in the international community. Ukraine now has preferential access to the EU market thanks to the Deep and Comprehensive Free Trade Area signed in 2014, and a new free trade partner in the form of Canada after the two nations signed a free trade agreement in July that will eliminate the majority of tariffs on bilateral trade. It has also tapped into the technical know-how of United States customs officials, who have provided assistance to the Ukraine Government as it modernizes it customs regime.
You get the sense that the Western powers are heavily invested in the future economic success of Ukraine. And encouragingly, ongoing efforts to improve the tax regime are a signal that the country is not only relying on the good will of others, but is helping itself as well as it attempts to secure more foreign investment. It is a shame, therefore, that tensions with Russia will continue to overshadow the economy, at least as long as Vladimir Putin sticks around.
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