Speaking at the Final Conference on Practice and Problems of Tax Law Application held by the Association of Ukrainian Taxpayers, Governor of the National Bank of Ukraine has said that the National Bank of Ukraine collaborates closely with both tax authorities and banks – taxpayers and public associations of taxpayers.
“We are pleased with the results of joint efforts made by the Ministry of Finance of Ukraine, State Tax Service of Ukraine and the Association. We face common tasks, the implementation whereof is crucial for achieving quantitative benchmarks set forth in the Program launched by the President of Ukraine. The main thing is that there is a mutual understanding of the fact that we should create the right conditions for businesses before raising taxes,” noted Mr. Sergiy Arbuzov.
According to him, the joint efforts by the National Bank of Ukraine, Ministry of Finance of Ukraine, State Tax Service of Ukraine and the Association have resulted in:
a large number of banking transactions being taxed by using the algorithm for calculating the result based on the accounting data, in particular, lending, deposit and foreign exchange data;
applying a unified approach to the recognition of income arising from lending and deposit transactions;
determining the base for building up insurance reserves, proceeding from the amount of debt arising from all types of active transactions;
transactions related to the assignment of debt being taxed in terms of the inclusion of the difference between the outstanding amount of debt and the asking price into the gross expenditures;
the negative value of the taxable object of the previous tax periods being included to the expenditures of next tax periods.
The joint efforts by the National Bank of Ukraine, Ministry of Finance of Ukraine, State Tax Service of Ukraine and the Association have led to the distressed asset market activation, thereby easing the burden on banks. The Governor of the National Bank of Ukraine has emphasized that the amount of problem loans has fallen by 9%, or by UAH 13 billion. The value of bad debt arising from lending transactions has shrunk by UAH 20 billion since the beginning of 2012.
СMr. Sergiy Arbuzov has communicated the tasks currently faced by the National Bank of Ukraine in the sphere of taxation: “We are elaborating a draft proposal for amendments to the Tax Code and other Laws, which are intended to:
exempt banks from paying VAT when the real estate provided to the creditor as collateral is sold to the third party by the bank;
exempt banks from exercising the function of a tax agent with regard to transactions related to the mortgaged property of individuals;
resolve the issue related to imposing taxes on the banks undergoing liquidation proceedings;
extend into 2013 the application of a 30% upper limit to banks allowing a tax exemption on provisions;
revise the norms regarding the recognition of income and expenditures arising from lending-deposit transactions;
revise regulations in order to exempt Ukrainian banks from paying VAT for payment system services”.
Summing up his keynote speech, Governor of the National Bank of Ukraine Sergiy Arbuzov said that the proposed measures would support economic growth, improve the efficiency of tax policy and ensure the banking system stability.