You're reading: Agreement reached: Simplified tax system remains the same

The Ukrainian government has agreed with entrepreneurs protesting against the Tax Code that the simplified tax system will remain the same as it was before the adoption of the code.

Such a provision is stipulated in a memorandum on the coordination of joint actions regarding the Tax Code, which was signed by a government working group and small businesses working under the simplified taxation system, reads a statement posted on the official Web site of the Ukrainian government.

The statement says that the memorandum was signed after the latest round of talks held on Wednesday. The government was represented at the talks by Ukrainian Finance Minister Fedir Yaroshenko.

The government and entrepreneurs agreed to set up a permanent coordinating council for small- and medium-sized businesses at the Cabinet of Ministers of Ukraine and to include small- and medium-sized businessmen in the public councils and collegiums of the executive authorities.

According to the memorandum, the amendments agreed by the parties will be introduced to the 1st, 2nd, 13th and 14th sections of the Tax Code.

The parties also agreed that the authorities would not apply the penalties on pension contributions added as of Dec. 1, 2010 for entrepreneurs who are single taxpayers and to complete the legislation on single social contributions by Jan. 1, 2011.

The memorandum also foresees legal guarantees for the participants of the protests.

The document also stipulates that the heads of agencies who made mistakes while drafting the Tax Code will be brought to justice.

"Thus, the memorandum agrees the positions on all issues that troubled the businessmen, and outlines the mechanism for the participation of businessmen in drafting tax legislation and exercising public control over the authorities," the statement says.

Ukrainian Finance Minister Fedir Yaroshenko said that the signing of the memorandum was a result of the government and businessmen having united.

"I want to thank [the entrepreneurs] for their active and fruitful cooperation. We are already working as a united team, and we have a full understanding of what we need to do," he said after the signing of the memorandum.

Yaroshenko said that the talks were very difficult, but the parties had finally reached understanding and agreed all of the problematic issues. He also added that all issues under dispute would soon be resolved.

"The memorandum is a compromise and constructive position that helps find the right path for entrepreneurs to work normally," he said, adding that the memorandum agrees not only their positions on the Tax Code, but also other issues that currently concern businessmen.