THE VERKHOVNA RADA PASSED LAWS ON THE DEOFFSHORIZATION OF THE ECONOMY

 On January 16, 2020, the Verkhovna Rada of Ukraine adopted in the second reading and in general two bills №1209-1 and №1210, on the improvement of tax administration and elimination of certain inconsistencies in the national tax legislation. 256 people's deputies voted for the bill №1209-1, 283 deputies for №1210.

 According to the press service of the Ministry of Finance of Ukraine, the introduction of new standards will also promote compliance with the principle of fair taxation, with tax policy - all levels before taxpayers, and increase Ukraine's image in international relations, which will definitely improve the investment climate and attract new investors.

 It is noted that in terms of tax administration, within the Tax Code of Ukraine introduces a new principle for taxpayers, the so-called guilty liability of the taxpayer for tax offenses; requirements for the correctness of decisions of regulatory authorities on the imposition of fines on taxpayers are determined; the list of tax offenses on the part of controlling bodies and material responsibility of the body for illegal actions of its officials is fixed, which will unequivocally give business some levers of influence and more effective position of protection against illegal actions of taxpayers.

 Regarding the implementation of the provisions of the BEPS action plan, the following is introduced:

• the concept of taxation of profits of controlled foreign companies at the level of the controlling person;
• three-level documentation structure for international groups of companies, which includes transfer pricing documentation (local file), global documentation (master file) and country-by-country reporting;
• the concept of taxation of payments equated to dividends, which provides for adjustments to the methodology and procedures provided for the control of transfer pricing, in carrying out any transactions with non-residents;
• the provisions of steps 8-10 of the BEPS plan to control the distribution of functions, risks and intangible assets within the group of companies are implemented;
• the procedure for conducting the mutual agreement procedure is determined, which provides for the mechanism for submitting an application for consideration of the case under the mutual agreement procedure, the requirements for such an application, the procedure for the competent authority, etc.