The Ukrainian Tax Administration's Response to the Crisis

It is widely known in Ukraine that the performance of the State Tax Administration (STA) is assessed by the volume of collected tax revenues, which is tracked on a monthly and annual basis. It is these figures that matter, and not the level of taxpayer service or public opinion. A new year has just started and the STA is already asking the Government to reduce the targets on tax revenues for 2009, which are the same as last year for company profit tax and slightly higher for VAT.

The STA argues that the targets are unrealistic considering the general decline in production and trade, the reduction of exports, etc. The signal is clear – we should prepare for hard times and the STA doesn’t want to be a poor performer, with a culture that demands the set targets should be exceeded, a heritage coming from the Soviet past.

This last decade tax revenues have been growing from year to year, based on a natural tendency of inflation and GDP growth.

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Posted by Nadiya Pustovoytova on January 29, 2009 in Eastern Europe | Permalink | TrackBack (0)