VAT FRAUD CRIMINALIZATION INITIATIVE

 The issue of value added tax administration is always relevant, and in every country. Our state is no exception, which carries out all actions to automate many issues related to VAT: the electronic queue of those wishing to reimburse a negative value, the process of registration of tax invoices or adjustment calculations, and so on.

 However, the use of various schemes, VAT evasion and related illegal actions has raised the issue of VAT administration to a new level, in particular through publicity and media coverage of specific companies carrying out such actions.

 In this regard, a group of people’s deputies of Ukraine took the initiative and registered a draft Law of Ukraine on the establishment of criminal liability for VAT fraud (draft registration number 3959). The draft law proposes to amend the Criminal Code of Ukraine, in particular to supplement it with Article 222-2 entitled "VAT fraud". Disposition as a socially dangerous act under this article defines theft or misappropriation of budget funds by obtaining a budget reimbursement or filing a claim for reimbursement of the amount of budget reimbursement based on the submission of knowingly false information, including the use of knowingly forged document. That is, the objective side of the crime is alternatively defined.

The initiators of the bill envisage the following acts as qualifiers:

• repeatedly;
• organized group;
• in significant amounts (receipt of budget compensation in the amount of up to UAH 3,153,000);
• in large amounts (receipt of budget compensation in the amount of up to UAH 5,255,000);
• in especially large amounts (receipt of budgetary compensation in the amount of more than UAH 5,255,000).

 In general, a crime is not serious, but committing it on a large scale makes it serious, and on a particularly large scale - in a particularly serious.

  It should be noted that this composition is special, as we have similar articles 212 of the Criminal Code of Ukraine (tax evasion, fees); Article 222 (fraud with financial resources), and therefore the question of the effectiveness of the implementation of such novelties remains open.

 In parallel, it is proposed to create a new body of pre-trial investigation: the Bureau of Economic Security of Ukraine to determine the jurisdiction of tax crimes. Thus in the State tax service of Ukraine (tax militia) powers on investigation of crimes are taken away.

  It should be noted that a similar initiative has been repeatedly submitted for consideration, including the establishment of the State Bureau of Financial Security and other similar bodies, but the Verkhovna Rada did not vote for its emergence.

 This initiative is currently being considered by a committee (Main Committee: Law Enforcement Committee).

 In order to constantly be in the trend of tax and other legislative changes, choose the law firm "Prikhodko and Partners" as a legal partner.