Ukrainian version of ‘Google tax’ may cause significant inconvenience for consumers of SMEs – ULIE

The Ukrainian version of the so-called "tax on Google", the bill which the Verkhovna Rada adopted on June 3 (No. 4184), is the most sweeping and raises concerns whether attempts to obtain funds for the budget will entail significant inconveniences for consumers of small and medium-sized enterprises (SMEs), the Ukrainian League of Industrialists and Entrepreneurs (ULIE) has said.

"The so-called "tax on Google" (in general, on multinational IT companies) has existed for quite a long time in the EU countries. This caused a flurry of discussions in Europe itself, as well as in the United States, and some changes in the pricing policies of companies. For the European format this is not about 20%, but on average 2-3-5%. Therefore, the Ukrainian version is the most sweeping," ULIE said in a statement released on Friday.

So, according to ULIE President Anatoliy Kinakh, in this regard, users can expect an increase in the cost of electronic services.

"What it will be – an insignificant percentage or more – is unknown. After all, it all depends on the policies of giant companies such as Google, Facebook and others. For example, at one time, after "tightening" the tax screws in Europe, the tech giant Apple said that it would increase fees paid by application developers – thus the company was able to transfer part of the cost of new digital taxes to small businesses," Kinakh said.

The President of the ULIE added that the European Union must make a final decision on the specifics of taxation of the "transnational figure" by the end of summer 2021 (certain statements have been made since 2019), and here, in his opinion, Ukraine should simply take part in this process and join the rules of the game established in the EU.

"This would allow the state to pass new legislation and harmonize it with the EU all in a lump," Kinakh said.

As reported, the Verkhovna Rada adopted at the final reading bill No. 4184 on the so-called "tax on Google", which proposes to equalize the rules of taxation for international technology companies with Ukrainian ones.

Source: www.en.interfax.com.ua