KIEV, Ukraine, September 2, 2014 /PRNewswire/ --
Former Ukrainian Minister of Revenues and Duties Oleksandr Klymenko
(http://oleksandrklymenko.com) cast a spotlight on the massive exit
of funds from Ukraine to countries
with preferential taxation systems. Klymenko notes that in 2014
to-date, 75% of all export operations were carried out under
contracts between Ukrainian businesses with countries whose tax
structures provide distinct advantages over current conditions in
Ukraine.
"Due to the pull of profitability from Ukraine toward countries with preferential
taxation systems, in the short-term the Ukrainian treasury risks to
lose tax revenues in the amount of UAH 2.6 billion due to transfer
pricing practices by businesses," said Klymenko. "The Government is
expecting to receive a similar amount - UAH 2.9 billion - from the
recently imposed 'military tax.' But my analysis of this army
tariff, which places the financial burden of military actions on
the shoulders of ordinary citizens, shows the Government of
Ukraine will only succeed in
collecting 10% of its projected figures."
Kiev has disclosed that the
country's treasury is empty and announced the government need to
cut expenditures and, accordingly, the necessity to increase
revenue to the nation's coffers.
As opposed to relying on the newly-enacted and untested military
tax, which does not differentiate between income levels of
taxpayers,
Klymenko (http://oleksandrklymenkotaxesukraine.com) stresses the
need to vigorously implement transfer pricing legislation which,
after overcoming numerous hurdles, was adopted in Ukraine in 2013. Klymenko asserts this
approach would be far more effective in "recovering significant
revenues from Ukrainian businesses which should be going into the
country's treasury but instead are transferred to Cyprus, Switzerland and other nations with mild tax
climates."
Klymenko, who served as Minister of Revenues and Duties from
December 2012 to February 2014
(http://oleksandrklymenko4euintegration.com/), views the true
potential to increase tax revenue as being through forceful
transfer pricing control and not application of the military tax.
Klymenko highlights this course of action as "enabling the
state treasury to make substantial gains without overly burdening
the average taxpayer." Klymenko cautions the current
administration not to ignore the largely untapped "treasure" which
can be attained from properly-administered transfer pricing
controls.
For additional information:
Andrey Sokolov, Adviser to
Oleksandr Klymenko
info@oleksandrklymenko.com / +380677658787
SOURCE Lone Star Communications