Business communities urge Zelensky to hold institutional reforms
MOSCOW. April 1 (Interfax) - Participants in the Reform of the Public Finance System - the Path to the Restoration of Ukraine congress and business community members have urged Ukrainian President Vladimir Zelensky to implement the tasks identified by leading think tanks and business associations as key priorities this year.
They defined as key institutional reforms a reset of the Financial Investigations Service and the State Customs Service, including an open election of their heads where international partners will have the casting vote, re-certification of employees during the year, approval of KPIs, as well as market salaries of State Customs Service employees, Ukrainian media said on Friday, citing an address of the Ukrainian Business Council.
A reset of the State Tax Service on the same terms as that of the State Customs Service, including the establishment of quality Civilian Control Councils, and an inclusive approach to the elaboration of state policies and strategies are yet another priority.
Additionally, businessmen request an effective, transparent mechanism of international business travels of company executives, employees and individual entrepreneurs.
Businessmen ask Zelensky and the Ukrainian parliament to prevent pressure by law enforcement agencies, which leads to substantial economic losses and thwarts budget revenue. They recommend establishing the presumption of innocence of the taxpayer (so that it is not the taxpayer who proves one's innocence, but the body that proves the guilt), the delegation of all functions in pre-trial investigation of economic crimes to the Financial Investigations Service, and personal liability of investigators (prosecutors and judges) for violation of the Criminal Procedure Code and standards of prosecutors' conduct in the protection of investments during the pretrial investigation, as those principles have been approved and must be mandatory.
Businesses also propose to introduce monthly reporting on criminal cases that have been investigated for more than 6 months and property frozen (seized) by law enforcement agencies and to ensure the protection of the rights of parties to criminal proceedings.
As part of the tax and customs legislation reform, businesses ask to reduce the overall tax burden on the payroll fund and replace the income tax with a tax on withdrawn capital after the end of martial law, noting that relevant amendments should be drafted in advance. They also ask for changing the ideology of the system for monitoring risk assessment criteria from "punitive' to analytical, and setting a deadline for blocking tax invoices with an increase in the mandatory threshold for registering as a VAT payer.
The statement of business associations emphasized the need for preservation of the current simplified taxation system and minimizing its abuse, in particular, by legally defining criteria to distinguish between labor relations and freelancing.
Business expects the commitment to the guaranteed obligations for terms of doing business in the Diia.city tax mode for 25 years, full-scale automatic exchange of information with other countries, and development of an effective mechanism for automated comparison of documents on the customs value of goods.
As for reducing ineffective budget expenditures, entrepreneur ask for a revision and optimization of expenses, the higher efficiency and adjustment of public expenditures to the new demographic realities (lesser spending on representative bodies, the judiciary, education, healthcare and housing subsidies).
Eighteen business associations, including the Association of Taxpayers of Ukraine, the Federation of Employers, IT Ukraine Association, the Ukrainian Agri Council, the All-Ukrainian Association of Entrepreneurs, SUP, Board, CLUB100, CEO Club, CFO Club, Kharkiv IT Cluster, the Oil and Gas Association of Ukraine, the Chamber of Commerce and Industry, the Ukrainian Cluster Alliance, the Ukrainian Federation of the Security Industry, UCAB, the Ukrainian Direct Selling Association of Direct Sales and Ukrpischeprom, signed the address.
It is also signed by three business coalitions, namely, the Ukrainian Business Council, the Business Coalition for Modernization of Ukraine, and the National Business Coalition.