Yanukovych signs law on tax benefits for some projects, including Air Express

Ukrainian President Viktor Yanukovych has signed law No. 9649-d on amendments to the Tax Code stipulated in the law on the realization of the project on the construction of infrastructure facilities in Kyiv region, granting some tax benefits, the press service of the State Agency for Investment and National Project Management has reported.

The law will allow increasing efficiency of the realization of the Air Express project, foreseeing the organization of high-speed train movement from Kyiv-Pasazhyrsky station to Boryspil International Airport and development of the airport's infrastructure.

Head of State Agency for Investment and National Projects of Ukraine Vladyslav Kaskiv said that from the strategic point of view the project gives a chance for the future of many-billion Chinese investments.

"The successful start of cooperation stimulates talks on the realization of three other projects on the basis of a new model – without state guarantees," Kaskiv said.

The Air Express project also plans to upgrade rolling stock and develop other infrastructure projects in Kyiv region, in particular, a small orbital road.

As reported, projects for the construction of Air Express, the city orbital road around Kyiv city on the Kyiv-Boryspil section, and a road from the Podilsky Bridge to Vatutina Avenue in Kyiv have obtained large tax benefits

A total of 249 lawmakers supported amendments to the Tax Code stipulated in the law on the realization of the project on the construction of infrastructure facilities in Kyiv region (No. 9649-d).

According to the law, imported goods and services and temporary imports of goods, transactions on the supply of the finished facility by the executor to the customer are exempted from value added tax (VAT). The list of goods and services is approved by the Cabinet of Ministers of Ukraine.

In addition, Air Express project participants are exempted from tax on profit and land tax.

The Air Express project is being realizing using borrowed funds issued by China with Ukrainian government guarantees.

A framework agreement signed between Boryspil International Airport and China National Chemical Engineering Group Corporation in September 2010, gives Ukraine a chance to obtain a credit worth up to $1 billion. It foresees the construction of a railway from Kyiv to Boryspil airport, the building of four stations and the purchase of electric trains.

In April 2011, the government decided to secure a credit of $372.31 million to realize the project.

In May 2011, Ukraine and China agreed on a loan for the project.