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12:55 03 Jun 2021

People's Deputies supported draft law on "Google tax"

The Verkhovna Rada adopted the draft law №4184  in the second reading and in general, which, in particular, will oblige Internet giants operating in Ukraine to pay taxes to the Ukrainian state budget. 283 people's deputies supported the document.

The press service of the Verkhovna Rada informed about this, Rubryka reports.

It is noted that the law is aimed at increasing the state budget revenues from VAT by attracting non-residents to VAT taxing, providing electronic services to individuals, the place of supply of which is located in the customs territory of Ukraine.

And also, to create favorable conditions for effective and unburdensome administration for business and the state of procedures related to tax payment.

The document, in particular, stipulates that international companies operating in the information space of Ukraine and earning on online advertising will pay taxes in Ukraine, including VAT.

It is emphasized that the project will not apply to ordinary users of social networks and search services.

The draft law also defines the concept of "electronic services" and specifies the place of their supply, in addition, establishes the features of registration of a non-resident as a taxpayer, determines the tax base, tax payment deadlines, tax reporting, appeals against regulatory decisions.

In addition, it provides for the payment of tax liability by a non-resident in foreign currency, a simplified procedure for registration of a VAT payer non-resident (it may occur remotely).

It also provides for releasing non-residents from the obligation to register tax invoices.

The draft law excludes the norm from the Tax Code, according to which residents must pay tax at the 20% rate of such payment amount at their own expense when paying income to non-residents for the production and/or distribution of advertising.

Also, the supply of electronic services by providing access to electronic educational (training) resources within providing educational services is exempt from VAT.

The document includes non-residents in the list of persons registered as VAT payers and establishes the rules for determining the place of supply of electronic services (B2C).

As reported by Rubryka, the Verkhovna Rada adopted the draft law №4184 as a basis, which will oblige Internet giants operating in Ukraine to pay taxes to the Ukrainian state budget in February 2021.

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