On 27 May 2014 the Resolution of the Cabinet of
Ministers of Ukraine of 21 May 2014 No. 139 (the “Resolution”)
came into force. The Resolution
provides for the issue
of government
bonds (so-called
VAT-bonds)
for the purposes of VAT refunding.
The terms of the issue of the VAT-bonds are the
following:
- Refunding through the VAT-bonds is voluntary. А
taxable person willing to obtain VAT-bonds should submit a respective
application to his local tax authority;
- Amount of the VAT to be refunded through the
VAT-bonds is currently unknown. In the nearest future the
Ministry of
Revenue and
Duties of Ukraine
is supposed to carry out the inventory of
the VAT indebtedness. Based on the results of such an inventory the
Cabinet of Ministers of Ukraine will approve the threshold limit of
the issue;
- Refunding through
the VAT-bonds
will cover only
those amounts of
VAT which had been
declared for
refunding by 1 January 2014;
- Premised on the plain reading of the Resolution,
the only amounts of the
VAT confirmed by tax audits can be refunded through the VAT-bonds. It
is unclear whether it will be possible to refund in such a way the
VAT amounts confirmed by the court judgments awarded in the cases
concerned with challenging the results of the tax audits;
- Taking into
account the time
set forth by the Resolution for drafting
the inventory registers
of the VAT
indebtedness as well as the conduct of other formalities
required for the
issue of the VAT-bonds,
the issue may
be expected not
earlier than in
the middle of
August 2014;
- VAT-bonds are going to be issued in
non-documentary form (uncertified
securities). The par value of the VAT-bonds
is going to be UAH 1,000. The interest
rate equals to that of the National Bank of Ukraine at the time of
the the Resolution’s entry into force (9,5% per annum). The
interest repayments are going to take place every six months;
- Circulation term of the VAT-bonds is 5
years. The
Resolution stipulates the gradual repayment
of the bonds. The state
is going to repay 10% of the
par value every
six months. Thus, in 5 years 100% of the par value is going to be
repaid.
Photo from
http://finance.obozrevatel.com
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