Kyiv, July 9, 2015. The VAT electronic administration system was launched and fully operational as of July 1. The system oversees all tax invoice registration and calculates invoice corrections in the Unified Register of Tax Invoices (URTI). “4.2 million tax invoices have been registered in the Unified Register of Tax Invoices over the eight days that the VAT electronic administration system has been operating in regular mode. Calculated corrections have been registered pertinent to VAT amounting to 13.8 billion hryvnia. Also, 18,500 declarations have been registered and add up to the VAT sum of 3.26 billion hryvnia. Four thousand seven hundred operations to replenish electronic accounts were made, amounting to 2.16 billion hryvnia,” said Roman Nasirov, Head of the State Fiscal Service of Ukraine at a press briefing at Ukraine Crisis Media Center.
After the VAT administration system became fully operational in its current mode, tax invoices are registered in the URTI and include numbers calculated using the formula defined by the Tax Code, known as the “registration sum”. “From July 1, corrections to tax invoices can be registered in the URTI using the sum of the input VAT and of the tax paid at customs,” noted Nasirov. If the sum in question does not cover the invoice amount, the payer must to replenish his or her electronic account in the VAT electronic administration system in order to account for lacking funds.
Unlike its test mode, the system’s regular mode is expected to apply fines if a taxpayer violates the registration deadline for tax invoice submissions in the USTI between 1 and 15 days. “The fine constitutes 10% of the VAT amount filed in the tax invoice,” said Nasirov. He also emphasized that the system is not expected to divert taxpayers’ working capital. To resolve the issue, the registration sum needs to increase. Several figures must serve as the basis for this increase. The figures include the so-called “overdraft”, an increase equal to the negative value incurred by payers before February 1, 2015 and an increase equal to the surplus formed as of July 1 this year that the taxpayer paid into the budget.
According to Nelia Pryvalova, Director of the Methodological Department of the State Fiscal Service of Ukraine, changes to the Tax Code have been prepared to account for suggestions submitted by businesses to improve the electronic administration system. According to the draft law, VAT funds from agricultural producers are not subject to payment into the state budget but are to be transferred to special accounts.
Additionally, it has been suggested that tax invoice account details no longer in use be cancelled. In order to decrease the number of tax invoices and cut diversion of VAT payers’ working capital, the right to compile unified tax invoices once per month in case goods are supplied in an uninterrupted mode has been suggested. Other changes have also been suggested. Even in its current stage, one can see the positive effects of introducing the VAT electronic administration system. “Money is circulating in the system, tax invoices are registered, tax payers get all requested information about the system and the State Fiscal Service of Ukraine worked out additional services so that the users are able to successfully use the system,” concluded Pryvalova.