RESTRICTEDWORLD TRADE
ORGANIZATIONWT/ACC/UKR/61
17 August 1999
(99-3456)
Working Party on the
Accession of UkraineOriginal:  English
ACCESSION OF UKRAINE
Memorandum on Taxation Regime
The following memorandum on the taxation regime has been received from the Governmental
Commission on Ukraine's Accession to WTO.
_______________
Taxation Regime
1. Value-added tax
According to the Law of Ukraine “On Value Added Tax”, No.168/97, of 3 April 1997,
operations of taxpayers in sales of goods (works and services) in the customs territory of Ukraine,
import (shipping) of goods into the customs territory of Ukraine, and receiving works (services)provided by non-residents for their use or consumption in the customs territory of Ukraine, including
import (shipping) of property according to leasing agreements, collateral, and mortgage, as well as
export (shipping) goods outside the customs territory of Ukraine and providing services (executing
works) for their consumption outside the customs territory of Ukraine, are subject to taxation.
Collection of the value-added tax (VAT) on imported goods is conducted according to the
principle of a destination country, that is, the taxation of goods being imported into the country ofdestination is in keeping with the norm generally accepted in world practice, with which Ukraine also
complies.
The taxation base is the agreed (contract) value of the imported goods, but no less than the
customs value indicated in the customs cargo declaration, taking into account expenses fortransportation, loading, unloading, transfers, and insurance to the point of crossing the customs border
of Ukraine, payment of to broker, such agents, commissions, and other types of fees connected with
import (shipping) of the goods, excise and import duties, and other taxes and levies (mandatory
payments), except for value-added tax that are included in the price of the goods.  The specified price
is recalculated in Ukrainian hryvnias according to the currency (exchange) rate of the National Bankof Ukraine valid on the date of the obligation to pay.
Taxation rates: 20 per cent, zero rate, exemption.With the aim of creating more favorable conditions for paying VAT on imported goods
without delay by providing customs control bodies w ith a simple note for the total tax owed, the Law
of Ukraine “On Value Added Tax” No.168/97, of 3 April 1997, establishes taxation on imported
goods at 20 per cent.
As for VAT on sales of goods (works, services) in the customs territory of Ukraine, including
payments for services according to leasing agreements and transfers of ownership rights in mortgaged
assets to lenders (creditors) to redeem credit debts of mortgagors, the tax base for the sale of goodsWT/ACC/UKR/61
Page 2
(works, services) is defined as based on their agreed (contract) value, specified according to
unregulated or regulated prices (tariffs), including excise, import duty, and other taxes and levies
(mandatory payments), except value-added tax, that are included in the price of the goods (works,
services) according to the laws of Ukraine on taxation.  The agreed (contract) value includes any sums
of money plus the value of tangible and intangible assets being transferred to the taxpayer directly bythe buyer or via any third person in connection with compensating the value of the goods (works,
services) sold (executed, provided) by said the taxpayer.
In the case of the sale of goods (works and services) without payment or partial payment of
their value in funds limited to barter (goods-exchange) operations, in-kind payment of wage payments
of natural persons in labor relations with taxpayer s; the transfer of goods (works, services) to the
balance of taxpayers for non-production use, related expenses which are not part of the grossproduction (cycle) expenditures and are not subject to amortization, or to a person connected to the
seller, the taxation base is based on the actual price of the operation, but not less than regular prices.
The Law of Ukraine “On Value Added Tax” No.168/97, of 3 April 1997, provides that the
export of goods outside the customs territory of Ukraine (regardless of the country of destination) istaxed at a zero rate, that is, VAT is not imposed only on exported goods, but also on the tax payer
(except in cases of export effected through barter has the right to a refund of the VAT paid by
suppliers on raw materials used to prepare the exported goods (or paid for the exported goods in
middleman operations).
The zero-rate tax is calculated based on methods defined in item 6.2 of the Law. In addition,
item 6.3 of the Law does not permit the application of zero tax rate to export operations on goods
(works and services) when such operations are exempt from taxation in the customs territory of
Ukraine according to clauses 5.1-5.2 of the said Law.  The law does not stipulate a list of goods
subject to VAT, but stipulates a list of VAT-exempt operations (defined in clauses 5.1-5.3 of the Law“On Value Added Tax” No.168/97, of 3 April 1997).
While crossing the customs territory of Ukraine, certain operations listed in the above-
mentioned law are exempt from taxation, as well as critical import goods, whose VAT-free import is
effective until 1 January 1999.
The Cabinet of Ministers Resolution “On Implementing the Agreement Between the Government of
Ukraine and Government of the Russian Federation on Free Trade” No.13, of 5 January 1998,
establishes a VAT exemption on goods originating from the customs territory of Ukraine as of
1 February 1998.
The Cabinet of Ministers Resolution “On Implementing the Agreement Between the Government of
Ukraine and the Government of the Republic of Belarus on Free Trade”, No.203, of
18 February 1998, establishes a VAT exemption on goods originating from the customs territory of
Ukraine as of 16 February 1998.
2. Excise
Issues relating to the collection of excise  are regulated by the Decree of the Cabinet of
Ministers “On Excise” No.18-92, of 26 December 1992, as amended.  According to this decree, the
following areas are subject to taxation: (products) made in Ukraine by way of sale; exchange for other
goods (products, works and services); the free transfer of goods (products) or with partial payment;revenue from the realization (transfer) of goods (products) for personal consumption or industrial
processing (except revenue from realization (transfer) for the production of excisable goods), and for
employee use; and the customs (if absent, then purchase) value of imported goods (products) acquired
for foreign currency or as part of exchange or free transfer.WT/ACC/UKR/61
Page 3
The Supreme Rada Resolution “On the Unification of Excise Rates for Imported and
Domestic Goods”, No.332/95, of 29 May 1995, specifie s the procedure for collecting excise taxes,
establishes the list of excisable goods, and declares excise rates to be equal both for domestic and
imported goods.  Currently existing excise privileges for an insignificant group of domestic goods
were introduced on an interim basis only with the aim of supporting domestic producers of excisablegoods during the transition economic period of Ukraine, as well as to prevent setting dumping prices
for certain groups of excisable goods.
In addition, there is the Law “On Excise Tax for Alcoholic Beverages and Tobacco Products”
No.329/95, of 15 September 1995.
The list of goods subject to excise and the excise tax rates are defined in the corresponding
laws of Ukraine. Excise is calculated in two ways:
- fixed rates in ECU per quantity of goods (liter, kilogram, unit, cc);
- rates in per cent of the sale price or customs value of the goods, taking into account customs, -
duty, and excise, but not VAT.
Excise is also collected on the sales revenue from excisable goods (products) acquired before
1 January 1992.
The draft Tax Code of Ukraine provides for significant reductions in the number of excisable
goods.
Privileges on paying excise are stipulated in the Decree of the Cabinet Ministers “On Excise”
No.18-92, of 26 December 1992, the Law of Ukraine “On Excise and Import Duty Rates for Certain
Goods (Products)”, No.313/96, of 11 July 1996, the Law of Ukraine “On Excise and Import DutyRates for Certain Transport Means and Rails for Them” No.216/96, of 24 May 1996, Law of Ukraine
“On Excise and Import Duty Rates for Ethyl Alcohol and Alcoholic Beverages” No.178/96, of
7 May 1996, and Resolution of the Supreme Rada "On the Introduction of the Law of Ukraine on
Excise and Import Duty Rates for Ethyl Alcohol and Alcoholic Drinks", No.179/96, of 7 May 1996.
3. Reforming the tax system of Ukraine
The tax system of Ukraine is currently being reformed, indicated by the introduction of
measures to rationalize excise; that is a review of excisable goods and excise rates, and clarification of
certain norms of the Law “On Value Added Tax”, No.168/97, of 3 April 1997.
At the same time, the State Tax Administration of Ukraine, together with a working group
created pursuant to the Order of the Cabinet of Ministers No.92-r, of 18 February 1998, is working on
the preparation of a draft Tax Code of Ukraine, which is required to establish a legally equal approach
in the taxation of all categories of taxpayers, decreasing their tax burden, complying with international
treaties with regard to taxation, etc.
A significant shortening of the list of excisable goods (services), up to seven groups, is
envisaged in the draft Tax Code of Ukraine. These seven groups are the following: ethyl alcohol and
alcoholic beverages, tobacco products, beer, gasoline; diesel; transportation means and rails for them;
jewelry; and mobile communications services. This draft is currently being considered by the Cabinet
of Ministers of Ukraine. After that it will be submitted to the Supreme Rada of Ukraine.
Also, concerning the unification of excise tax pursuant to Ukraine's current international
obligations, new legislative documents are being developed to regulate this issue; in particular, the
draft Law of Ukraine “On Excise” No.18-92, of 26 December 1992, is being prepared for its second
reading in the Supreme Rada of Ukraine. The Resolution of the Cabinet of Ministers “On AmendingWT/ACC/UKR/61
Page 4
the Resolution of the Cabinet of Ministers of Ukraine No.1433, of 2 December 1996”, No. 331, of
13 March 1999, cancels the minimum customs value for imported malt beer.  A list of goods
(products) for which excise rates have been set a ccording to current legislation and a list of excise
privileges valid in 1999, as of 1 March 1999, will be circulated shortly.  Also, aiming to implement
the conditions of the Memorandum on Understanding between Ukraine and the EU in March 1999, aschedule for cancelling minimum customs values has been prepared.WT/ACC/UKR/61
Page 5List of Excise Duty Exemptions Valid During 1999 as of 1 March 1999
Excise
Duty on
Domestic
Goods14020000  Excise Duty Exemptions on Domestic
Goods     
 14020001  Goods subject to excise duty to be
exported and paid for in foreign currency(except for spirits and tobacco goodsexempted from excise duty by provisionsof the Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products” of 15.09.95 No.329/95-BP(exemption code 14020007)) are exemptfrom excise duty.  Resolution of the Cabinet of
Ministers of Ukraine “On ExciseDuty”, Article 5 18-92  26.12.92  11.01.93  
 14020002  The turnover from selling specially
designed cars for invalids paid by socialsecurity bodies, as well as special
purpose cars (such as ambulance, police)
is exempt from excise duty based on thelist approved by the Cabinet of Ministersof Ukraine.  Resolution of the Cabinet of
Ministers of Ukraine “On ExciseDuty”, Article 5 18-92  26.12.92  11.01.93  
 14020006  The following items are exempt from
excise duty: c) customs value of
imported raw materials and turnover
from selling Ukrainian raw materialsused in production of goods subject toexcise duty.  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products”, Article 3, paragraph 2 c 329/95-BP  15.09.95  12.12.95  WT/ACC/UKR/61
Page 6 14020007  The following items are exempt from
excise duty: d) spirits and tobacco
products value exported abroad of thecustoms territory of Ukraine for sellingfor foreign currency under the conditionthis currency is transferred to theenterprise’s currency account.
  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products”, Article 3, paragraph 2 d 329/95-BP  15.09.95  12.12.95  
  Goods with code 2208 10 900 (cognac
spirit only) are “0” excise duty rated.  The Law of Ukraine "On Excise Tax
and Import Duty for Ethyl Spirit andAlcoholic Beverages" with changes
and additions, Article 1
  178/96-BP  07.05.98  07.03.98  
 14020011  Accessories used by Ukrainian
enterprises for production of transportvehicles specified by the Law are exemptfrom excise duty.  The Law of Ukraine “On Excise Duty
and Import Duty Rates for SomeTransport Vehicles and Tires toThem”, paragraph 5 216/96-BP  24.05.96  12.06.96  
 14020012  In compliance with the Law of Ukraine
the sides to Treaty are exempt from
excise duty.
  The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet Socialist
Republic ‘On Taxation System’”, theTreaty between Government ofUkraine and Government of theUnited States on humanitarian,technical and economic cooperation
   07.05.92  07.05.92  WT/ACC/UKR/61
Page 7 14020013  In compliance with the Law of Ukraine
the sides to Treaty are exempt from
excise duty.  The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theTreaty between Government ofUkraine and Government of theUnited States on Providing
Assistance with Liquidating of
Strategic Nuclear Weapons as well asPreventing Nuclear ArmamentProliferation   31.12.93  31.12.93  
 14020014  In compliance with the Law of Ukraine
the sides to Agreement are exempt fromexcise duty.  The Law of Ukraine “On Introducing
Changes and Amendments to theLaw of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theFramework Agreement between
Government of Ukraine and
Government of Federal Republic ofGermany on consulting and technicalcooperation  32/97-BP  24.01.97  24.01.97  
 14020015  In compliance with the Law of Ukraine
the participants of the Program are
exempt from excise duty.
  The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet Socialist
Republic ‘On Taxation System’”, theProgram of Technical Assistancefrom European Community (TACIS)   02.08.91  02.08.91  WT/ACC/UKR/61
Page 8 14020016  In compliance with the Law of Ukraine
the sides to Agreement are exempt from
excise duty.  The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theAgreement on general conditions andmechanism of support of productioncooperation’s development between
enterprises and industries of CIS
member countries.   22.12.93  22.12.93  
 14020017  Tape recorders, furniture, food, mink,
nutria and fox fur clothes produced at
Ukrainian enterprises are temporally(until year 2000) exempt from exciseduty.  The Law of Ukraine “On Excise Duty
and Import Duty Rates for Some
Goods”, paragraph 4 313/96-BP  11.07.96  12.08.96  the validity
expires on
01.01.2000
 14020018  To exempt from excise duty turnover
(custom value) from selling clothes madefrom leftover and low-quality fur and
leather.
  The Law of Ukraine “On Excise Duty
and Import Duty Rates for SomeGoods”, paragraph 3 313/96-BP  11.07.96  12.08.96  
 14020019  To exempt from excise duty until
January,1 2007 turnover from sellingcars, trucks, passenger vehicles andmotorcycles made at Ukrainianenterprises of all types of property
ownership. Exemptions stipulated by this
Article apply to turnover from sellingtransportation means made by Ukrainianenterprises from imported and producedin Ukraine accessories under the
condition of producing not less than a
1000 cars and 1000 motorcycles a yearunder the procedures set by the Cabinetof Ministers of Ukraine.  The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘OnExcise Duty and Import Duty Ratesfor Some Transport Vehicles andTires to Them’”, Article 1, paragraph
1 340/97-BP  12.06.97  08.07.97  the validity
expires on01.01.2007WT/ACC/UKR/61
Page 9 14020020  To exempt from excise duty until
January,1 2000 turnover from selling car
tires (code 40 11 10000) made atUkrainian enterprises of all types ofproperty ownership. Exemptionsstipulated by this Article apply toturnover from selling tires made by
Ukrainian enterprises under the condition
of producing not less than a 100000 tiresa year under the procedures set by theCabinet of Ministers of Ukraine.  The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On
Excise Duty and Import Duty Ratesfor Some Transport Vehicles andTires to Them’”, Article 1, paragraph2 340/97-BP  12.06.97  08.07.97  the validity
expires on
01.01.2000
 14020021  To exempt from excise duty until
January,1 2000 turnover from sellingcolor TV sets (article code according tothe Harmonized inventory and goodsencoding system 8528 10) made at
Ukrainian enterprises of all types of
property ownership (with capacity ofeach enterprise for producing not lessthan 250000 of such TV sets a year)under the condition of producing not lessthan a 5000 TV sets a month.
  Decree of the President of Ukraine
“On Favoring Color TV SetsManufacturing”, paragraph 2 737/98  04.07.98   the validity
expires on01.01.2000
  To exempt from excise duty until
January,1 2001 turnover from sellingcolor TV sets (article code according tothe Harmonized inventory and goodsencoding system 8528 10) made atUkrainian enterprises of all types of
property ownership (with capacity of
each enterprise for producing not lessthan 100000 of such TV sets a year)under the condition of producing not lessthan a 1000 TV sets a month using notless than 20% of domestically
manufactured accessories.
  The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘OnExcise Duty and Import Duty Ratesfor Some Goods’” 276-XIV  20.11.98  01.01.99  01.01.2001WT/ACC/UKR/61
Page 10  Excise duty is not paid by subjects of
entrepreneurial activities - primary wine
making enterprises on gettingunmethylated ethyl spirit formanufacturing of grape wine materials ormust (wort) under the condition when thestated wine materials or must are being
sold to secondary wine making
enterprises…. The procedure for gettingthe unmethylated ethyl spirit and it’s useby subjects of entrepreneurial activities -primary wine making enterprises is setby the Cabinet of Ministers of Ukraine.
  The Law of Ukraine “On Introducing
Changes to Some Laws of Ukraine on
Excise Duty and Import Duty Ratesand Excise Duty PaymentProcedures”, Article 4 311-XIV  11.12.98  06.01.99  
Excise
Duty on
Imported
Goods14030000  Excise Duty Exemptions on Imported
Goods     
 14030002  The turnover from selling specially
designed cars for invalids paid by social
security bodies, as well as specialpurpose cars (such as ambulance, police)is exempt from excise duty based on thelist approved by the Cabinet of Ministers
of Ukraine.
  Resolution of the Cabinet of
Ministers of Ukraine “On Excise
Duty”, Article 5 18-92  26.12.92  11.01.93  
 14030004  The following items are exempt from
excise duty: a) customs value of spiritsand tobacco products imported to theterritory of Ukraine and confiscated,belonging to an unidentified owner or
owned by the State on grounds of
inheritance.  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and TobaccoProducts”, Article 3, paragraph 2 a 329/95-BP  15.09.95  12.12.95  WT/ACC/UKR/61
Page 11 14030005  The following items are exempt from
excise duty: b) customs value of spirits
and tobacco products crossing theUkrainian territory as transit goods.  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products”, Article 3, paragraph 2 b 329/95-BP  15.09.95  12.12.95  
 14030006  The following items are exempt from
excise duty: c) customs value of
imported raw materials and turnoverfrom selling Ukrainian raw materialsused in production of goods subject toexcise duty.
  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products”, Article 3, paragraph 2 c 329/95-BP  15.09.95  12.12.95  
 14030008  The following items are exempt from
excise duty: f) customs value of spirits
and tobacco products samples importedto Ukrainian territory for demonstrationunder the condition it stays property toforeign legal entities and it’s use onUkrainian territory is not of commercial
nature. At that spirits and tobacco
products samples imported to Ukraineand destined to be demonstrated onexhibitions, contests, meetings, seminarsand fairs are allowed through the frontier
by decision of a customs body in
sufficient amounts subject to objectivesof their use.  The Law of Ukraine “On Excise Duty
on Alcoholic Beverages and Tobacco
Products”, Article 3, paragraph 2 f 329/95-BP  15.09.95  12.12.95  WT/ACC/UKR/61
Page 12  Goods with code 2208 10 900 (cognac
spirit only) are “0” excise duty rated.
  The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On
Excise Tax and Import Duty for EthylSpirit and Alcoholic Beverages’",Article 1  The Law of Ukraine “On Introducing
Changes to Some Laws of Ukraine on
Excise Duty and Import Duty Ratesand Excise Duty PaymentProcedures”, Article 1, Part 1  121/98-BP
 
    
 311-XIV 12.02.98
 
    
 11.12.98 07.03.98
 
     06.01.99 06.01.99
 14030011  Accessories used by Ukrainian
enterprises for production of transportvehicles specified by the Law are exemptfrom excise duty.  The Law of Ukraine “On Excise Duty
and Import Duty Rates for SomeTransport Vehicles and Tires toThem”, paragraph 5 216/96-BP  24.05.96  12.06.96  
 14030012  In compliance with the Law of Ukraine
the sides to Treaty are exempt from
excise duty. The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet Socialist
Republic ‘On Taxation System’”, theTreaty between Government ofUkraine and Government of theUnited States on humanitarian,
technical and economic cooperation.
   07.05.92  07.05.92  
 14030013  In compliance with the Law of Ukraine
the sides to Treaty are exempt fromexcise duty. The Law of Ukraine “On Introducing
Changes and Amendments to theLaw of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theTreaty between Government of
Ukraine and Government of the
United States on ProvidingAssistance with Liquidating ofStrategic Nuclear Weapons as well asPreventing Nuclear ArmamentProliferation.
  31.12.93  31.12.93  WT/ACC/UKR/61
Page 13 14030014  In compliance with the Law of Ukraine
the sides to Agreement are exempt from
excise duty. The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theFramework Agreement betweenGovernment of Ukraine andGovernment of Federal Republic of
Germany on consulting and technical
cooperation.  32/97-BP  24.01.97  24.01.97  
 14030015  In compliance with the Law of Ukraine
the participants of the Program are
exempt from excise duty  The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet SocialistRepublic ‘On Taxation System’”, theProgram of Technical Assistancefrom European Community (TACIS)   02.08.91  02.08.91  
 14030016  In compliance with the Law of Ukraine
the sides to Agreement are exempt from
excise duty The Law of Ukraine “On Introducing
Changes and Amendments to the
Law of Ukrainian Soviet Socialist
Republic ‘On Taxation System’”, theAgreement on general conditions andmechanism of support of productionco-operation’s development between
enterprises and industries of CIS
member countries.   22.12.93  22.12.93  WT/ACC/UKR/61
Page 14
List of Value Added Tax Exemptions Valid as of 1 March 1999
No. Value Added Tax Exemptions Law of Ukraine that Stipulated the
ExemptionRegistr-ation
numberDate Valid from Valid until Note
1. Turnover from selling goods (works,
services) including imported goods that are
used for manufacturing items according to
contract # 1346/38, as well as turnoverfrom selling final products to provider forcontract fulfilment is exempt from valueadded tax (VAT).
The list of enterprises participating in
production of goods (works, services)according to this contract, nomenclatureand product volumes, to which Article 1 ofthe Law apply, is approved by the Cabinetof Ministers of Ukraine. The procedure for
exemption use control is set by the Cabinet
of Ministers of Ukraine.The Law of Ukraine “On Value Added Tax
Exemptions Concerning Goods (Works,
Services) Produced Under the Contract #
1346/38”, Articles 1, 26/97-BP 17.01.97
2. In compliance with the Law of Ukraine the
sides to Treaty are exempt from VAT.The Law of Ukraine “On Introducing
Changes and Amendments to the Law ofUkrainian Soviet Socialist Republic ‘OnTaxation System’”, the Treaty between
Government of Ukraine and Government of
the United States on humanitarian, technicaland economic cooperation07.05.92 07.05.92WT/ACC/UKR/61
Page 153. In compliance with the Law of Ukraine the
sides to Treaty are exempt from VAT.The Law of Ukraine “On Introducing
Changes and Amendments to the Law of
Ukrainian Soviet Socialist Republic ‘OnTaxation System’”, the Treaty betweenGovernment of Ukraine and Government ofthe United States on Providing Assistancewith Liquidating of Strategic Nuclear
Weapons as well as Preventing Nuclear
Armament Proliferation31.12.93 31.12.93
4. In compliance with the Law of Ukraine the
sides to Agreement are exempt from VAT.The Law of Ukraine “On Introducing
Changes and Amendments to the Law of
Ukrainian Soviet Socialist Republic ‘OnTaxation System’”, the FrameworkAgreement between Government of Ukraineand Government of Federal Republic ofGermany on consulting and technical
cooperation32/97-BP 24.01.97 24.01.97
5. In compliance with the Law of Ukraine the
participants of the Program are exemptfrom VAT.The Law of Ukraine “On Introducing
Changes and Amendments to the Law ofUkrainian Soviet Socialist Republic ‘OnTaxation System’”, the Program ofTechnical Assistance from European
Community (TACIS)02.08.91 02.08.91
6. In compliance with the Law of Ukraine the
sides to Agreement are exempt from VAT.The Law of Ukraine “On Introducing
Changes and Amendments to the Law ofUkrainian Soviet Socialist Republic ‘OnTaxation System’”, the Agreement ongeneral conditions and mechanism of
support of production cooperation’s
development between enterprises andindustries of CIS member countries.22.12.93 22.12.93WT/ACC/UKR/61
Page 16
7. To exempt from VAT raw materials,
production materials, equipment
(excluding goods subject to excise duty)that are imported to Ukraine for needs ofmanufacturing of experimental economiczone “Sivash” subjects.The Law of Ukraine “On Certain Issues of
Currency Regulations and Taxation of
Experimental Zone “Sivash” Subjects”65/96-BP 23.02.96 24.02.96
8. To exempt from VAT operations on:
emission, floatation and selling ofsecurities emitted by subjects ofentrepreneurial activities, the National
Bank of Ukraine, the Ministry of Finance
of Ukraine, the State Treasury of Ukraine,local self-government bodies includingprivatization and compensationcertificates, dwelling checks, land bondsand derivatives; the exchange of securities
for other securities; depositorial,
registration and clearing actions withsecurities.The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.1, paragraph 3.2168 03.04.97 01.10.97
9. To exempt from VAT operations on:
transfer of property by a resident lessor tothe lessee according to the terms of leasing
agreement and its returning to the lessor
after the termination of validity of theleasing agreement;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.2, paragraph 3.2168 03.04.97 01.10.97
10. To exempt from VAT operations on:
leasing payments according to the terms ofa financial leasing agreement or according
to a dwelling leasing agreement that is the
permanent domicile of the lessee.The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.2, paragraph 3.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 1711. To exempt from VAT operations on:
transfer of property as a collateral to the
creditor according to the terms of a loanagreement and its returning to thedepositor after termination of validity ofthe loan agreement;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.2, paragraph 3.2168 03.04.97 01.10.97
12. To exempt from VAT operations on:
transfer by a resident creditor of an objectof a real estate loan into property or use ofthe borrower;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.2, paragraph 3.2168 03.04.97 01.10.97
13. To exempt from VAT operations on:
money payments of the principal andinterest according to the terms of the realestate loan;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.2, paragraph 3.2168 03.04.97 01.10.97
14. To exempt from VAT operations on:
insurance services stipulated by the Law ofUkraine “On Insurance”, social and
pension insurance;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.3, paragraph 3.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 18
15. To exempt from VAT operations on:
turnover of currency valuables (including
national and foreign currency), monetarymetals, banknotes and coins of theNational Bank of Ukraine, except for thosesold for numismatic purposes; emission,turnover and retirement of the State lottery
bonds emitted with permission of the
Ministry of Finance of Ukraine; paymentsof money winnings, money prizes andmoney awards; selling of uncancelled poststamps of Ukraine, envelopes and leaflets
with uncancelled post stamps of Ukraine,
except for collection post stamps,envelopes and leaflets for philatelistpurposes;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.4, paragraph 3.2168 03.04.97 01.10.97
16. To exempt from VAT operations on: cash
collection services, settlement of accounts,attracting, investing and paying backmoney under the terms of agreements ofloan, deposit, insurance or power of
attorney; granting, managing and
reassignment of financial credits, creditguarantees and bank guarantees by aperson who provided such credits orguarantees;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.5, paragraph 3.2168 03.04.97 01.10.97
17. To exempt from VAT operations on: cash
or securities trading by promissory notes,
except for debt requirement collection
operations and factorial operations;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.5, paragraph 3.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 1918. To exempt from VAT operations on:
payments for state services rendered to
physical persons and legal entities bybodies of executive power and local self-government which are considered by thelegislation to be obligatory, includingregistration fee, license fee, certificate
takings and state duty;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.6, paragraph 3.2168 03.04.97 01.10.97
19. To exempt from VAT operations on:
wages payments, pensions, grants,
subsidies, State subsidies, other money or
property payments to physical persons onaccount of budgets or social/ insurancefunds according to procedure set by theLaw; dividend payments in money orsecurities (corporate rights), rendering of
broker or dealer services when setting
agreements on securities and derivativestrading at stock and commodity exchangescreated according to pr ocedures stipulated
by the Laws of Ukraine “On Securities and
Stock Exchange” and “On Commodity
Exchange”;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.7, paragraph 3.2168 03.04.97 01.10.97
20. To exempt from VAT operations on:
transfer of principal funds as charter fee tocharter funds of legal entities for propertyfunds formation in exchange to theircorporate rights; compensation sale of
aggregated gross assets of a taxpayer
(including goodwill value) to anothertaxpayer;The Law of Ukraine “On Value Added
Tax”, subparagraph 3.2.8, paragraph 3.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 20
21. To exempt from VAT operations on:
fundamental research value payments,
scientific research works and constructionresearch works fulfilled on the account ofthe State budget of Ukraine;The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 3.2.9, paragraph3.2550 26.09.97 02.10.97
22. To exempt from VAT operations on: sale
of domestic baby food by specializedcook-houses, stores and distributionstations, according to procedures andproducts lists set by the Cabinet of
Ministers of Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.1, paragraph 5.1168 03.04.97 01.10.97
23. To exempt from VAT operations on:
selling (prepayment) and delivery of issuesof local periodics, newspapers andmagazines;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.2, paragraph 5.1168 03.04.97 01.10.97
24. To exempt from VAT operations on: sales
of locally printed books;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.2, paragraph 5.1168 03.04.97 01.10.97
25. To exempt from VAT operations on: sales
of school notepads, manuals and trainingtext books;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.2, paragraph 5.1168 03.04.97 01.10.97WT/ACC/UKR/61
Page 2126. To exempt from VAT operations on:
rendering according to the list set by the
Cabinet of Ministers of Ukraine serviceson higher learning, secondary, vocationaland primary education by educationestablishments having special license forfulfillment of such services; and training
and education services of children by rural
cultural establishments, children’s musicaland art schools;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.3, paragraph 5.1168 03.04.97 01.10.97
27. To exempt from VAT operations on: sales
of specialized goods for invalids accordingto the list set by the Cabinet of Ministers ofUkraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.4, paragraph 5.1168 03.04.97 01.10.97
28. To exempt from VAT operations on:
pensions and money aid delivery services
to population;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.5, paragraph 5.1168 03.04.97 01.10.97
29. To exempt from VAT operations on: civil
census registry services by the State bodiesauthorized to provide such registrationaccording to the legislation;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.6, paragraph 5.1168 03.04.97 01.10.97
30. To exempt from VAT operations on: sales
of drugs and medical purpose products
registered in Ukraine according to
procedures set by the legislation, includingrendering services of such sales by drugstores;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.7, paragraph 5.1168 03.04.97 01.10.97WT/ACC/UKR/61
Page 22
31. To exempt from VAT operations on:
health protection services according to the
list set by the Cabinet of Ministers ofUkraine, health protection bodies that havespecial license for rendering such services;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.8, paragraph 5.1168 03.04.97 01.10.97
32. To exempt from VAT operations on: sales
of tickets for places in sanatoriums, healthresorts and spa and children’s holidays inplaces listed by the Cabinet of Ministers ofUkraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.9, paragraph 5.1168 03.04.97 01.10.97
33. To exempt from VAT operations on:
rendering services according to proceduresand within norms set by the Cabinet ofMinisters of Ukraine which include: takingcare of children in kindergartens, boardingschools, juvenile delinquency lock rooms
of the bodies of the Ministry of Internal
Affairs of Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.10, paragraph 5.1168 03.04.97 01.10.97
34. To exempt from VAT operations on:
taking care of persons in old people’s andinvalids homes, meals andaccommodations for night’s lodging for
homeless in specially assigned places;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.10, paragraph 5.1168 03.04.97 01.10.97
35. To exempt from VAT operations on:
children’s meals in schools, vocationalschools and citizens in health protectionestablishments;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.10, paragraph 5.1168 03.04.97 01.10.97WT/ACC/UKR/61
Page 2336. To exempt from VAT operations on:
meals, uniforms, lodging and other
communal services provided to specialcontingent in penitentiary system’sestablishments in accordance with the listapproved by the Cabinet of Ministers ofUkraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.10, paragraph 5.1168 03.04.97 01.10.97
37. To exempt from VAT operations on:
rendering services by the Stateemployment centers in accordance with the
list approved by the Cabinet of Ministers
of Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.11, paragraph 5.1168 03.04.97 01.10.97
38. To exempt from VAT operations on:
rendering services by the archives bodiesof Ukraine connected to provision ofdocuments from the National Archives
Fund of Ukraine to legal entities and
physical persons, as well as sales to thearchives bodies of Ukraine of documentsof the National Archives Fund of Ukrainewhich are in possession of legal entities orphysical persons according to the
Ukrainian legislation;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.12, paragraph 5.1168 03.04.97 01.10.97
39. To exempt from VAT operations on:
rendering of religious services and sale ofitems of religious purpose by religiousorganizations according to the listapproved by the Cabinet of Ministers of
Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.14, paragraph 5.1168 03.04.97 01.10.97WT/ACC/UKR/61
Page 24
40. To exempt from VAT operations on:
rendering funeral services to any taxpayer;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.15, paragraph 5.1168 03.04.97 01.10.97
41. To exempt from VAT operations on:
transfer of confiscated property, finds,
treasures or property without owner into
disposal of State bodies authorized to keepit or sell it according to the legislation;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.16, paragraph 5.1168 03.04.97 01.10.97
42. To exempt from VAT operations on:
transfer of land plots located under realestate objects or land free of buildings in
cases when such transfer is allowed
according to provisions of the Land Codeof Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.17, paragraph 5.1168 03.04.97 01.10.97
43. To exempt from VAT operations on:
gratuitous transfer of a rolling-stock by arailway line administration or an enterpriseof railway transport of common purpose to
other railway line administration or
enterprise of railway transport of commonpurpose of public form of propertyownership according to procedure set bythe Cabinet of Ministers of Ukraine;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.18, paragraph 5.1168 03.04.97 01.10.97
44. To exempt from VAT operations on:
privatization of public property in
exchange of privatization bonds orcompensation certificates, as well asgratuitous privatization of the dwellingfund, farmland and land plots according to
the legislation;The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 5.1.19,paragraph 5.1550 26.09.97 02.10.97WT/ACC/UKR/61
Page 2545. To exempt from VAT operations on:
execution of dwelling construction works
(works value) realized on account of assetsof physical persons, and transfer of suchdwelling into property of the physicalpersons;The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 5.1.20,paragraph 5.1550 26.09.97 02.10.97
46. To exempt from VAT operations on:
rendering of charitable aid such asgratuitous transfer of goods (works,services) (including cases when the aid is
imported to the customs territory of
Ukraine) into property of scientific andsports establishments who’s activities arefunded from budgets; kindergartens,elementary, secondary, vocational schoolsand high learning establishments;
religious, charitable organizations
registered according to procedureestablished by the legislation, as well asoperations on gratuitous transfer of suchgoods (works, services) to subjects of
charitable aid accordingly to the legislation
of Ukraine;The Law of Ukraine “On Introducing
Changes to Certain Laws of Ukraine On theIssues of Taxation”664 19.11.97 13.12.97WT/ACC/UKR/61
Page 26
47. To exempt from VAT operations on: sale
of goods (works, services), except for
items subject to excise duty and gamblingbusiness, by enterprises founded by all-Ukrainian public organizations of invalidswho’s property belongs to them in full,where quantity of invalids having there
primary job is not less than 50% of the
total quantity of employees as of theprevious accounting period and undercondition that the invalids’ wages fundreaches not less than 25% of the total
wages costs included into gross expenses
(turnover) of the enterprise. The list of all-Ukrainian public organizations of invalidsto who’s enterprises the exception isgranted is approved by the Cabinet ofMinisters of Ukraine.The Law of Ukraine “On Introducing
Changes to the Article 5 of the Law of
Ukraine ‘On Value Added Tax’”698 05.12.97 25.12.97
48. To exempt from VAT operations on:
execution of works funded by investors’assets concerning dwelling construction
for servicemen, war veterans and members
of families of servicemen who perishedduring fulfilment of their duty;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.2.2, paragraph 5.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 2749. To exempt from VAT operations on:
gratuitous transfer of domestically
produced goods (works, services) byfarms, therapeutic and productionworkshops (departments) of boardinghouses and territorial centers on servicinglone aged persons (pensioners) under the
condition that such transfer is done for
provision of the stated establishments’ ownneeds;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.2.3, paragraph 5.2168 03.04.97 01.10.97
50. To exempt from VAT operations on:
rendering in the countryside by agriculturalproducers services on schools,kindergartens, boarding schools, healthprotection establishments repairs andgranting material aid (within one non-
taxable minimum income of a citizen a
month per one person) in the form ofdomestically grown foodstuff and landcultivation services for families havingmany children, war and labor veterans,
rehabilitated citizens, labor invalids,
invalids crippled from childhood, loneaged persons, victims of Chernobylcatastrophe, and schools, kindergartens,boarding schools, health protectionestablishments;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.2.4, paragraph 5.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 28
51. To exempt from VAT operations on:
rendering in countryside by agricultural
producers services on delivering meals tomachine-servicers and zoologistsconsisting of domestically grown productsto field dining-rooms during field worksseason;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.2.4, paragraph 5.2168 03.04.97 01.10.97
52. To exempt from VAT operations on: sales
of goods (works, services) provided for thepersonal use of diplomatic representatives,
consular establishments of foreign states
and representatives of internationalorganizations to Ukraine, as well as for theuse of diplomatic personnel of thediplomatic missions and members of theirfamilies living together with personnel
employees according to procedures and list
of operations approved by the Cabinet ofMinisters of Ukraine;The Law of Ukraine “On Value Added
Tax”, paragraph 5.3168 03.04.97 01.10.97
53. To exempt from VAT operations on:
import to the customs territory of Ukraineof goods (works, services), except for the
ones subject to excise duty, provided for
the personal use of diplomaticrepresentatives, consular establishments offoreign states and representatives ofinternational organizations to Ukraine, aswell as for the use of diplomatic personnel
of the diplomatic missions and members of
their families living together withpersonnel employees.The Law of Ukraine “On Value Added
Tax”, paragraph 5.5168 03.04.97 01.10.97WT/ACC/UKR/61
Page 2954. The “zero” rate tax is collected from
operations on: sales of goods exported by a
taxpayer abroad of the customs territory ofUkraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.1, paragraph 6.2168 03.04.97 01.10.97
55. The “zero” rate tax is collected from
operations on: sales of works (services)destined to be used and consumed outsidefrom the customs territory of Ukraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.2, paragraph 6.2168 03.04.97 01.10.97
56. The “zero” rate tax is collected from
operations on: sales of goods (works,
services) to retail trade enterprises located
on the territory of Ukraine in the customscontrol zones (duty free shops) accordingto the procedure set by the Cabinet ofMinisters of Ukraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.3, paragraph 6.2168 03.04.97 01.10.97
57. The “zero” rate tax is collected from
operations on: rendering services on
passengers and freight transportation
outside of the customs frontier of Ukraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.4, paragraph 6.2168 03.04.97 01.10.97
58. To exempt from VAT operations on:
distribution of the locally grown farmproducts by agricultural enterprises tophysical persons - land share owners
included to these enterprises in the form of
value compensation for the use of suchshares by the agricultural enterprise but nomore than 70 hryvnias per one calendarmonth of the use of the land share;The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On ValueAdded Tax’”, paragraph 11.16550 26.09.97 02.10.97 valid until
January 1,2002WT/ACC/UKR/61
Page 30
59. To exempt from VAT operations on:
distribution of the locally grown farm
products by agricultural enterprises tophysical persons connected to theagricultural enterprise by laborrelationship, accordingly to actual workedhours but no more than 70 hryvnias per
one calendar month.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, paragraph 11.16550 26.09.97 02.10.97 valid until
January 1,
2002
60. The value of packaging is not included to
the taxation sum if according to the
agreement (contract) it is determined as
due to be returned or is considered to be adeposit.The Law of Ukraine “On Value Added
Tax”, paragraph 4.6168 03.04.97 01.10.97
61. To exempt from VAT operations on:
importing to the customs territory ofUkraine goods (including machine
accessories) used in construction and
production activities of automobile and caraccessories making enterprises withinvestments (including foreigninvestments) exclusively in cash formamounting to not less than a sum
equivalent to 150 million US dollars by
official exchange rate of the National Bankof Ukraine as of the date of making suchan investment to the charter fund andregistered by procedure set by thelegislation.The Law of Ukraine “On Favoring
Production of Automobiles in Ukraine”535/97-BP 19.09.97 23.10.97 valid until
January 1,2008WT/ACC/UKR/61
Page 3162. The “zero” rate tax is collected from
operations on sales to residents of Ukraine
of domestically manufactured cars thathave investments (including foreign)exclusively in cash form amounting to notless than a sum equivalent to 150 millionUS dollars by official exchange rate of the
National Bank of Ukraine as of the date of
making such an investment to the charterfund and registered by procedure set by thelegislation.The Law of Ukraine “On Favoring
Production of Automobiles in Ukraine”535/97-BP 19.09.97 23.10.97 valid until
January 1,
2008
63. The sum of VAT paid to providers for
material and technical resources aresubject to reimbursement from the budgetin the case of: sales of goods exported bythe taxpayer outside the customs territoryof Ukraine (except for barter operations).The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.4, paragraph 6.2168 03.04.97 01.10.97
64. The sum of VAT paid to providers for
material and technical resources aresubject to reimbursement from the budgetin the case of: sales of works (services)destined to be used and consumed outsidethe customs territory of Ukraine (except
for barter operations).The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.4, paragraph 6.2168 03.04.97 01.10.97WT/ACC/UKR/61
Page 32
65. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budgetin the case of: sales of goods (works,services) to retail trade enterprises locatedon the territory of Ukraine in customscontrol zones (duty free shops) according
to the procedure set by the Cabinet of
Ministers of Ukraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.4, paragraph 6.2168 03.04.97 01.10.97
66. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budgetin the case of: rendering services onpassengers and freight transportationoutside the customs territory of Ukraine.The Law of Ukraine “On Value Added
Tax”, subparagraph 6.2.4, paragraph 6.2168 03.04.97 01.10.97
67. To exempt from VAT operations on:
importing to the customs territory of
Ukraine sea fishery products (fish,mammals, mollusks, shellfish, sea weed aswell - refrigerated, salted, frozen, canned,processed into granules or else) fished bythe boats registered in the State boats
register of Ukraine or Boats Book of
Ukraine.The Law of Ukraine “On Introducing
Changes to Certain Laws of Ukraine On the
Issues of Taxation”794 30.12.97 27.01.98
68. The “zero” rate tax is collected from
operations on selling milk and meat by liveweight to processing enterprises byagricultural producers of all forms of
property ownership and management.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On ValueAdded Tax’”, subparagraph 6.2.6, paragraph6.2770 23.12.97 01.01.98WT/ACC/UKR/61
Page 3369. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budgetin the case of: selling milk and meat bylive weight to processing enterprises byagricultural producers of all forms ofproperty ownership and management.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 6.2.6, paragraph6.2770 23.12.97 01.01.98
70. In case of importing goods originated from
the customs territory of Russian Federationto the customs territory of Ukraine and
destined for this territory the VAT is not
collected.The resolution of the Cabinet of Ministers of
Ukraine “On Implementation of the TreatyBetween Government of Ukraine and
Government of Russian Federation on Free
Trade”13 05.01.98 01.02.98WT/ACC/UKR/61
Page 34
71. The “zero” rate tax is collected from
operations on: selling goods (works,
services) of local production, except forgoods subject to excise duty, intermediary,advertising and gambling business, byenterprises founded by the UkrainianAssociation of Deaf People whose
property belongs to them in full, to other
taxpayers. The denoted order is valid onlyfor enterprises where the quantity ofinvalids having there their primary jobconstitute no less than 50% of the total of
employees as per previous accounting
period and wages fund of such invalidsconstitute no less than 40% of the totalwages fund of employees as per previousaccounting period included to the totalgross expenses (turnover) of the enterprise.
The procedure for attributing goods
(works, services) to enterprises founded bythe Ukrainian Association of Deaf Peopleis set by the Cabinet of Ministers ofUkraine.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 6.2.8, paragraph6.2, Article 6208 24.03.98 11.04.98WT/ACC/UKR/61
Page 3572. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budgetin the case of: selling goods (works,services) of local production, except forgoods subject to excise duty, intermediary,advertising and gambling business, by
enterprises founded by the Ukrainian
Association of Deaf People whoseproperty belongs to them in full, to othertaxpayers.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, subparagraph 6.2.8, paragraph6.2, Article 6208 24.03.98 11.04.98
73. In cases when according to agreements set
before implementation of this Law thatstipulated execution of operationsexempted from taxation by subparagraphs(d), (e) of paragraph 1, article 5 of the
Decree of the Cabinet of Ministers of
Ukraine “On Value Added Tax”, therewere made expenses or payments beforethe approval of this Law, the taxpayerswhich are parties to these agreements pay
taxes for such operations according to
rules established by the mentioned aboveDecree.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On ValueAdded Tax’”, paragraph 11.1550 26.09.97 02.10.97WT/ACC/UKR/61
Page 36
74. The sum of VAT paid for operations on
release of material valuables from the State
material reserve funds that were put inthere according to agreements signedbefore January 1, 1998 is used by the Statecommittee of Ukraine for material reservesexclusively for founding material
valuables to the State reserve fund for the
purpose of maintaining unreduced stockaccording to procedures set by the Cabinetof Ministers of Ukraine.The Law of Ukraine “On Introducing
Changes to the Law of Ukraine ‘On Value
Added Tax’”, paragraph 11.22169 04.03.98 28.03.98
75. The VAT is not collected on goods
originated from the Belarus Republiccustoms territory in case of their import tothe customs territory of Ukraine anddestination to this territory.The resolution of the Cabinet of Ministers of
Ukraine “On Implementation of the TreatyBetween Government of Ukraine andGovernment of Belarus Republic on FreeTrade”203 18.02.98 16.02.98
76. To exempt from VAT operations on:
gratuitous transfer of state titles’ objectsinto municipal titles of territorial public ofvillages, towns or into their collective title,as well as municipal titles’ objects intostate titles, that are on balance of one
group of taxpayers and is transferred to the
balance of another group of taxpayers incase when such operations are fulfilledupon the decision of the Cabinet ofMinisters of Ukraine, central or localbodies of executive power, bodies of local
self-government approved within their
authority.The Law of Ukraine “On Introducing
Changes to Certain Laws of UkraineBecause of the Approval of the Law ofUkraine ‘On Transferring State andMunicipal Titles’ Objects’”163 06.10.98 24.10.98WT/ACC/UKR/61
Page 3777. To exempt from VAT operations on:
import from abroad of the customs frontier
of Ukraine of goods as well as attendant tothem works (services) to the profit of retailtrade stores located on the territory ofUkraine in customs control zones (hereon -duty free shops), as well as to the territory
of the customs license warehouses located
on the territory of Ukraine (hereon -license warehouses).Decree of the President of Ukraine “On
Certain Changes to Taxation”857 07.08.98 01.10.98
78. To exempt from VAT operations on:
rendering services on municipalpassengers transportation who’s tariffs areregulated by the stipulated by the Lawprocedures, except for operations of hiringof passenger transport;The Law of Ukraine “On Value Added
Tax”, subparagraph 5.1.13, paragraph 5.1168 03.04.97 01.10.98
1
79. To exempt from VAT operations on
selling by production and trade enterprisesof children’s holiday presents bought oncosts of Social Insurance Fund of Ukraine,trade unions of enterprises andorganizations, other non-profit
organizations.The Law of Ukraine “On Exempting from
Taxation Funds Used for Organizing NewYear and Christmas holidays for Childrenand Youth and Operations on Sale ofChildren’s Holiday Presents”, Article 2228 05.11.98 01.12.98 15.01.99
80. To exempt from VAT operations on
rendering services on passengers andfreight transit transportation through theterritory and ports of Ukraine.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law ofUkraine ‘On Value Added Tax’”paragraph 11.15362 24.12.98 01.01.99 valid until
1.1.2000
                                                     
1 Changed according to the Decree of the President of Ukraine "On Certain Changes to Taxation" from 7 August 1998, No. 857.WT/ACC/UKR/61
Page 38
81. The “zero” rate tax is collected from
operations on: selling of coal and products
of it’s enrichment, coal and peat briquettes.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law of
Ukraine ‘On Value Added Tax’”, paragraph11.6368 25.12.98 0.1.01.99 valid until
1.1.2000
82. The “zero” rate tax is collected from
operations on: selling of electricity.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law ofUkraine ‘On Value Added Tax’”, paragraph11.6368 25.12.98 0.1.01.99 valid until
1.1.2000
83. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budget
in the case of: rendering services onpassengers and freight transittransportation through the territory andports of Ukraine for payments in foreigncurrency.
.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law of
Ukraine ‘On Value Added Tax’”, paragraph
11.15362 24.12.98 01.01.99 valid until
1.1.2000
84. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budgetin the case of: selling of coal and productsof it’s enrichment, coal and peat briquettes.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law of
Ukraine ‘On Value Added Tax’”368 25.12.98 0.1.01.99 valid until
1.1.2000
85. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budget
in the case of: selling of electricity.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law of
Ukraine ‘On Value Added Tax’”368 25.12.98 0.1.01.99 valid until
1.1.2000WT/ACC/UKR/61
Page 3986. The sum of value added tax calculated by
the taxpayers - agricultural producers on
operations of sales ofgoods/works/services of their ownproduction including production (exceptfor goods subject to excise duty)manufactured on “giving” conditions from
their own raw materials, except for
operations on sale of milk and meat by liveweight to processing enterprises - thisVAT sum is not to be paid to budget.The Decree of the President of Ukraine ‘On
Supporting Agricultural Producers’”1328/98 02.12.98 01.01.99 valid until
1.1.2004
87. The “zero” rate tax is collected from
operations on: selling of natural gasimported to Ukraine.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law ofUkraine ‘On Value Added Tax’”368 25.12.98 0.1.01.99 valid until
1.1.2000
88. The sum of VAT paid to providers for
material and technical resources are
subject to reimbursement from the budget
in the case of: selling of natural gasimported to Ukraine.The Law of Ukraine “On Introducing
Changes to the Article 11 of the Law of
Ukraine ‘On Value Added Tax’”368 25.12.98 0.1.01.99
89. During the functioning period of the
“Yavoriv” special economic zone the VATcollection is made subject to particularities
set by the Law of Ukraine “On ‘Yavoriv’
Special Economic Zone.The Law of Ukraine “On the Issues of
Taxation Related to Creation of the“Yavoriv” Special Economic Zone”403 15.01.99 valid until
1.1.2020
90. To exempt from paying VAT the import to
Ukraine of equipment (except for goodssubject to excise duty) for implementationof investment projects according to the
procedure set by the Cabinet of Ministers
of Ukraine.The Decree of the President of Ukraine “On
Special Regime of Investment ActivitiesApplied at the Priority DevelopmentTerritories in Lugansk Region”1359/98 28.12.98 04.02.99 valid until
1.1.2004WT/ACC/UKR/61
Page 40
91. During the functioning period of the
“Zakarpattia” special economic zone the
VAT collection for operations on goodsand other items export/import is madesubject to particularities set by thePresidential Decree “On the ‘Zakarpattia’Special Economic Zone”The Decree of the President of Ukraine “On
the ‘Zakarpattia’ Special Economic Zone”1339/98 09.12.98 09.01.99 valid until
1.1.2029
92. To exempt from VAT operations on
selling and gratuitous transfer of devices,equipment and materials to scientific
establishments and organizations, high
learning establishments of the III-IV levelsof credit included into the State register ofscientific organizations to which the Stategives it’s support on the condition of useof the aid exclusively for own needs.The Law of Ukraine “On Introducing
Changes to Certain Laws of Ukraine withthe Purpose of Supporting Scientific and
Technical Activities”285 01.12.98 22.12.98
93. To exempt from VAT operations on the
import by scientific establishments andorganizations, high learning establishmentsof the III-IV levels of credit, of scientificdevices and equipment used exclusivelyfor their own needs.The Law of Ukraine “On Introducing
Changes to Certain Laws of Ukraine withthe Purpose of Supporting Scientific andTechnical Activities”285 01.12.98 22.12.98WT/ACC/UKR/61
Page 4194. During the period of execution of works on
preparation to shut-down and shut-down of
power units of the Chernobyl nuclearpower station (NPS) from exploitation andconversion of the “Shelter” object into anecologically safe system operationsexecuted at the expense of the international
technical aid given on the no-cost and no-
return basis for the further exploitation,preparation to shut-down and shut-down ofpower units of the Chernobyl NPS fromexploitation and conversion of the
“Shelter” object into an ecologically safe
system and securing social protection tothe personnel of the Chernobyl NPS andSlavutitch population - operations onimport to the customs territory andpurchase on the customs territory of
Ukraine of goods (raw materials, materials
and equipment) are exempt from VAT.The Law of Ukraine “On the Basic
Conditions of the Further Use and Eventual
Shut-Down of the Chernobyl Nuclear PowerStation (NPS) and Conversion of the FourthDestroyed Power Unit of this NPS into anEcologically Safe System”309 11.12.98 13.01.99WT/ACC/UKR/61
Page 42
95. During the period of execution of works on
preparation to shut-down and shut-down of
power units of the Chernobyl nuclearpower station (NPS) from exploitation andconversion of the “Shelter” object into anecologically safe system operationsexecuted at the expense of the international
technical aid given on the no-cost and no-
return basis for the further exploitation,preparation to shut-down and shut-down ofpower units of the Chernobyl NPS fromexploitation and conversion of the
“Shelter” object into an ecologically safe
system and securing social protection tothe personnel of the Chernobyl NPS andSlavutitch population - operations onexecution of works and rendering servicesprovided within international technical aid
are exempt from VAT.The Law of Ukraine “On the Basic
Conditions of the Further Use and Eventual
Shut-Down of the Chernobyl Nuclear PowerStation (NPS) and Conversion of the FourthDestroyed Power Unit of this NPS into anEcologically Safe System”309 11.12.98 13.01.99
96. Temporary, until January 1, 2004,
operations on import to the customs
territory of Ukraine of goods (raw
materials, materials, equipment) used forproduction development and creation ofnew job vacancies in the town ofSlavutitch are exempt from VAT.The Law of Ukraine “On the Basic
Conditions of the Further Use and Eventual
Shut-Down of the Chernobyl Nuclear Power
Station (NPS) and Conversion of the FourthDestroyed Power Unit of this NPS into anEcologically Safe System”309 11.12.98 13.01.99 1.1.2004WT/ACC/UKR/61
Page 4397. To exempt from VAT operations on
selling aerospace complexes, aerospace
launch vehicles, aerospace apparatus,surface segments of aerospace systems andtheir assembly units, systems and theiraccessories manufactured by aerospaceindustry’s businesses through the
Ukraine’s State Budget funding.The Decree of the President of Ukraine “On
State Support to Aerospace Activities”1191/98 27.10.98 13.01.99 1.1.2009
98. To exempt from VAT equipment (except
for items subject to excise duty) imported
to Ukraine by “Slavutitch” zone subjects
for needs of local production connected torealization of investment projects approvedby procedure set by the Cabinet ofMinisters of Ukraine.The Decree of the President of Ukraine “On
‘Slavutitch’ Special Economic Zone”657 18.06.98 20.07.98 1.1.2010
99. During “Azov” special economic zone
functioning collection of the value added
tax is performed subject to peculiarities setby the Law of Ukraine “On SpecialEconomic Zone and Special Regime ofInvestment Activities in Donetsk Region”.The Law of Ukraine “On Special Economic
Zone and Special Regime of Investment
Activities in Donetsk Region”356 24.12.98 14.01.99 1.1.2059
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