The President of Ukraine, Volodymyr Zelenskyi, approved the law, which amends the Tax Code of Ukraine, taking into account the Recommendations of the Organization for Economic Cooperation and Development (OECD). A document known as draft law No. 10319, aimed at improving tax measures in the fight against bribery of foreign officials in international business transactions.
The new law will contribute to the implementation of international standards in the field of corruption prevention, in particular by prohibiting the deduction from the tax base of expenses related to illegal benefits, regardless of investigations or court decisions.
The functions of the control body have been expanded, which will now inform NABU and the taxpayer about the facts or circumstances discovered during the inspection that may indicate the granting of an illegal benefit. Both the State Tax Service and taxpayers will act in accordance with the list of such facts approved by NABU in agreement with the Ministry of Finance.
It is also envisaged to provide tax payers and tax authorities with clear instructions on determining expenses that are classified as bribery, as well as simplifying the mechanisms for reporting by tax authorities to law enforcement officers about possible facts of corruption.
The purpose of the law is to introduce a mechanism for identifying potential illegitimate benefits even before a court decision is issued. This should stimulate compliance with tax legislation (Tax Compliance), which corresponds to the principles of the OECD. During the preparation of the draft law for the second reading, the Ministry of Finance took into account the comments of OECD experts.
