On January 15th, the chairman of the parliamentary committee on finance, taxation and customs policy, Daniil Getmantsev, announced in his Telegram channel that several bills have been submitted to the Verkhovna Rada (Ukrainian parliament) proposing to introduce value-added tax (VAT) on all orders from foreign online stores. This news has sparked a heated debate among Ukrainian citizens and businesses.
Currently, Ukrainian residents are exempt from paying VAT on orders from foreign online stores, as long as the total value of the goods does not exceed 150 euros per month. This has been seen as a major advantage for Ukrainian consumers, who have been able to purchase goods from abroad at a lower price compared to domestic retailers. However, the proposed bills seek to change this and impose a 20% VAT on all orders, regardless of their value.
Supporters of the bill argue that this measure will bring much-needed revenue to the Ukrainian budget and help to level the playing field for domestic businesses. They claim that the current tax exemption for foreign online purchases has led to a significant loss of revenue for the state, as well as unfair competition for local retailers who are required to pay VAT. They also argue that this move will encourage Ukrainians to support their own economy and purchase goods from domestic retailers.
On the other hand, opponents of the bill argue that this will have a negative impact on the already struggling Ukrainian economy. They believe that the introduction of VAT on all foreign online purchases will discourage consumers from making such purchases and ultimately lead to a decrease in overall consumption. This, in turn, will have a negative effect on the country’s economic growth and development. They also argue that this will disproportionately affect low-income families who rely on affordable goods from foreign online stores.
The proposed bills have caused a great deal of concern among Ukrainian citizens, especially those who frequently shop from foreign online stores. Many have taken to social media to voice their opinions, with some even organizing protests against the proposed measures. In response, the Ukrainian government has promised to carefully consider all arguments before making a final decision.
One of the main concerns raised by opponents of the bill is the potential increase in prices for goods purchased from foreign online stores. With the addition of a 20% VAT, the total cost of goods will undoubtedly rise, making them less affordable for many Ukrainians. This could also lead to a decrease in the overall quality of life for Ukrainian citizens, as they will have to spend more on basic necessities.
Another concern is the impact on small businesses and entrepreneurs who rely on selling goods through foreign online platforms. The introduction of VAT on all orders will significantly increase their costs and potentially make their businesses unviable. This could lead to job losses and a decrease in economic activity.
However, supporters of the bill argue that the proposed measures will not have a significant impact on the overall cost of goods for consumers. They claim that the 20% VAT will be offset by the removal of customs duties and other fees currently imposed on foreign online purchases. They also believe that the introduction of VAT will help to combat the issue of tax evasion, as some Ukrainian citizens have been known to falsely declare the value of their purchases in order to avoid paying taxes.
In conclusion, the proposed introduction of VAT on all orders from foreign online stores in Ukraine has sparked a heated debate among citizens and businesses. While supporters argue that it will bring much-needed revenue to the state and level the playing field for domestic retailers, opponents believe that it will have a negative impact on the economy and the overall cost of living for Ukrainians. As the government continues to consider the proposed bills, it is important for all sides to carefully weigh the potential consequences and reach a decision that will benefit the country as a whole.
