On 9 December, 2008 the State Tax Administration of Ukraine issued Instruction setting up new rules for selecting large taxpayers. Unlike previous instruction this one is public and companies may know whether they will be considered as large taxpayers.
Under new rules scoring system is applied for selection. Company receives ‘large taxpayer’ status, if it receives 1 point for each indicator and passes 5 point threshold.
Point gross income assessed taxes paid taxes VAT refund
1 20M – 100M 200K – 1M 200K – 1M 3M – 15M
2 100M – 500M 1M – 5M 1M – 5M 15M – 30M
3 >500M >5M >5M >30M
The group of large taxpayers in Kyiv, Sevastopol and regions shall generate at least 50% of regional budget’s tax revenues. Otherwise, taxpayers gaining 4-3 points will also fall under definition of large taxpayers.
The aim of selecting is to focus effort on large taxpayers that account for a large percent of total tax collection. For example, about 4 thousand taxpayers, comprising only 0,6% of registered companies, generated up to 65% of the state budget tax revenues in 2008. Large taxpayers are serviced by special tax offices. They are characterized by the divisions specialized in work with taxpayers of the definite economic sector e.g. mining, banking, agricultural, etc. It enables the revenue administration to deploy their best auditors and investigators to scrutinize cases related to large taxpayers.