You're reading: Ukraine: cancels the utilisation fee for recycling imported vehicles

 On 8 April 2014, the Ukrainian Parliament adopted changes to the Tax Code of Ukraine, which should positively impact the whole automotive industry. 

Specifically, Parliament cancelled the utilisation fee for the future recycling of almost all vehicles imported to the country. 

The fee was previously considered to be an ecological tax levied on the owners of both new and used imported vehicles. The utilisation fee had to be paid prior to or on the day of submission of the customs declaration, and represented an additional heavy financial burden for the buyers and owners of the vehicles. The rates of the utilisation fee depended on different circumstances, including the kind of vehicle and whether the vehicle was new or used, etc. The tax rate varied from a minimum of UAH 4,400 (approx. EUR 250, according to the current exchange rate), up to UAH 60,500 (approx. EUR 3,350).

The abolishment of the utilisation fee is regarded as a progressive step towards Ukraine’s integration into the European market and the harmonisation of Ukrainian legislation with European standards.

The law shall become effective from the date of its official promulgation, which is expected soon.

Law: Law of Ukraine on Amendments to the Tax Code of Ukraine (with respect to abolishment of the utilisation fee and excise duty as regards reconfiguration of the vehicle).

Authors: 

Olexander Martinenko, Senior Partner, [email protected]

Olga Belyakova, Senior Associate, [email protected]