The Kyiv Post welcomes feedback about our new website and we stand ready to fix any problems users might encounter in our test phase. Contact us at: news@kyivpost.com or +38-044-591-3344. Thank you!

Share Tweet Pocket Add to Bookmarks
You're reading: Experts: IT tax cuts fail to address persistent problems
Popular
on social media

However, industry players say that although the new legislation will somewhat improve profit margins for IT business owners, it failed to address the main issue of eliminating shadow employment, a step needed across Ukraine’s economy to bolster its strained pension fund.

Instead, parliament only July 6 reduced the corporate income and value added tax for Ukrainian software developers to 5 percent, down from 25 and 20 percent, respectively. Legislators also sought to cut personal income tax rates for employees working in the IT industry from 15 to 5 percent. The measure, included in a previous version of the legislation, was rejected by Yanukovych.

Still missing from the legislation are measures which would cut Ukraine’s heavy payroll taxes, which keep the IT industry, as well as the nation’s economy overall, in the shadows. Keen not to pay payroll taxes in the 34-50 percent range, many employers in Ukraine pay the lion’s share of employee salaries under the table. They only show a small portion of what is paid to tax officials.

Exclusive article

Select your subscription plan now and gain access to all exclusive content on KyivPost.com.

See All Plans
$5.95
per month
Website

Gain access to all exclusive Kyiv Post stories and opinions online.

Subscribe
$9.95
per month
Unlimited

Weekly delivery of the newspaper, unlimited access to all exclusive content on KyivPost.com.

Subscribe
Advertisement

Add comment

Sorry, you must be logged in to post a comment.
More in this section
Attention

Add a picture
Choose file
Add a quote
Attention

Are you sure you want to delete your comment?

Attention

Are you sure you want to delete all user's comments?

Attention

Are you sure you want to unapprove user's comment?

Attention

Are you sure you want to move to spam user's comment?

Attention

Are you sure you want to move to trash user's comment?

Spelling error report

The following text will be sent to our editors: