News (#11 November 2019)

Law digest

Laws on introduction of single account for tax payment adopted

On 4 October the Ukrainian Parliament approved Draft Laws No. 1049 and No.1051 in the second and final readings, which introduce a single account for payment of taxes and fees and a unified social tax from 1 January 2021.

A single account is a State Fiscal Service account opened with the Treasury to be used by a taxpayer to pay taxes and fees administered by the Fiscal Service.

This single account will be used to pay corporate income tax, personal income tax, unified social tax, single tax, rent payment, as well as taxes payable thereon.††

However, a single account cannot be used to pay value added tax (VAT) and excise tax on fuel and alcohol, since there are two other, special e-administration systems for payment thereof. The single account also cannot be used for payment of the part of their net profit by state-owned and utility companies and associations thereof.†

To open a single account, a taxpayer may apply to the Fiscal Service through his/her e-account. The account will become available the day after submission of the application. Termination of its use is no earlier than 1 January 2020.†

A taxpayer submits to the servicing bank a settlement document on the transfer of the corresponding amount of funds to a single account. The Fiscal Service creates the necessary registers, indicating all the necessary information, including bank details of the recipients of funds, and sends these to the Treasury.

The Treasury distributes taxpayersТ funds between budgets and state target funds based on the registers received from SFS.†

Economic activities licensing

Parliament adopted Draft Law No.1060 On Improvement of the Procedure for Economic Activities Licensing in the second reading.

The document also establishes liability for non-execution of decisions made by the pre-trial appeal body, simplifies the procedures for issuing licenses, establishes a mechanism for temporary termination of a license instead of its complete withdrawal, and defines more stringent conditions for license revocation.

It also envisages:

Ч determining the procedure for a licence holder to appeal against a decision taken by a licensing body on suspension of a license;

Ч settlement of issues related to re-application for a license;

Ч excluding the grounds for licence revocation in case of non-payment for the issuance of a license by the license holder;

Ч mandatory inclusion in the licensing conditions of provisions on the accessibility of locations where the commercial activities are conducted for people with limited mobility;

Ч unification of the amount of fines imposed for violation of legislation in the field of licensing;

Ч improving the procedure for appealing against the actions of licensing bodies.

President signed law on geographic indications protection

The Ukrainian Parliament adopted Draft Law No.1065 on 20 September. It establishes the improvement of the legal protection of geographical indications within the framework of the Association Agreement with the EU.

The relevant changes will be introduced to the Commercial and Civil Codes of Ukraine, the Law On Protection of Rights to Indicate the Origin of Goods, and the Decree of the Cabinet of Ministers of Ukraine On State Duty.

It is noted that the implementation of this law will contribute to bringing national legislation into line to that of the EU, as well as to fulfillment of obligations undertaken by Ukraine under the Association Agreement with the EU.

According to the document, the term Уgeographical indicationФ is defined as the name of a place identifying a product originating from a certain geographical region and having special quality, reputation or other characteristics determined by its place of origin.

Therefore, according to the law, Ukrainian brand names should also get legal protection in the European Union. Their list is currently being created.

Law on revocation of licenses for telecommunications operators published

The Law On Amendments to Certain Legislative Acts of Ukraine on Reducing the List of Types of Economic Activities Subject to Licensing, which establishes the revocation of licenses for telecommunications operators, will come into force 3 months after its publication.

The law eliminates the legislative conflict of provisions of the law on licensing and the law on telecommunications. Namely, it excludes activities in the field of telecommunications from the list of types of economic activities subject to licensing. The document envisages replacing the licensing of telecommunications activities with the provision of notification by economic entities.

President Volodymyr Zelensky signed the document on 23 September.

Law On Protection of Financial Service Consumers signed

Ukrainian President Volodymyr Zelensky has signed the Law On Protection of Rights of Financial Service Consumers.

The document proposes to grant authorized bodies the right to apply enforcement actions against financial institutions and other business entities providing financial services and impose administrative penalties on their officials. The same rules are also introduced for banks and non-banking institutions working in the field of financial services advertising and information provision regarding the same.

Moreover, it is proposed to expand the concept of Уtotal costФ related to a consumer loan, by including all the costs incurred by the consumer, inter alia, the cost of additional and related services provided by third parties.

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