The following statement seemed to be posted on this internet and widely disseminated around Ukraine by a group calling itself your Council of National Coordination. This organisation is a new spontaneous reaction with a direct attack about the middle class with the government through the particular proposed introduction of a new tax code that is punitive and gives the taxes authorities unprecedented powers.
Statement
An address to any or all freedom-loving nations, governments and parliaments of the actual free countries in the world, and for the participants of the EU-Ukraine Summit
After this presidential elections inside Ukraine, the circumstance in our region has worsened, especially for us, modest- and medium-sized entrepreneurs (SMEs). We are usually not politicians, most of us are men and females, people ready to cover state taxes, but in accordance which has a transparent procedure. Most of us love our country; that is why we can’t stand aside when our lives are generally being ruined.
About 18 November 2010, the Ukrainian Parliament adopted a brand-new Tax Code, which often was drafted in addition to submitted by the government. The Code was adopted without proper discussion along with without taking straight into consideration the interests of entrepreneurs.
It was adopted by, less than 100 MPs who voted on behalf of 269 colleagues. This utterly discredits Ukraine’s parliamentary process and the adopted law. The actual Tax Code will probably completely destroy the actual middle class in Ukraine. It deprives millions associated with Ukraine’s citizens in their rights, robbing all of them of even any minimal means associated with existence and your survival.
In particular, the item introduces the suitable for tax authorities to arrest taxpayer’s assets without any court decision, so violating generally-recognised property rights. Indeed, the Tax Code gives the place a burden on authorities unprecedented powers that will certainly help them for you to simply rob entrepreneurs.
As regards the economy, the citizens of Ukraine have been pushed to this edge of the actual abyss. Entrepreneurs tend to be subjected to highly intrusive checks without notice. During these checks the activity of the enterprise is stopped and bribes are demanded. Enforcement and also fiscal bodies are raiding many enterprises, violating many procedural norms. Entrepreneurs are possibly forced to fork out bribes even to have VAT refunded.
In recent months mass protests have been held in towns and towns around Ukraine. Entrepreneurs in addition to employers, who attempt to create a future for the region with their work and inventive capacity, took part. We are the members of unique business associations in addition to unions of entrepreneurs. We usually are not involved throughout politics. The protests all on the country were neither organized nor inspired by means of any political get together. First it became a spontaneous reaction, then we organized with reaction against the intention of the actual authorities to refute our rights to have jobs.
Being driven into despair, we designed a National Coordination Council to dissolve the parliament which voted to help the anti-entrepreneurial and anti-national Tax Code. We all delivered our demand to the president.
We will never step back.
Using this address all of us not only need to express our feelings of despair, but in order to ask you regarding your support in addition to help in explaining to Leader Viktor Yanukovych that it Tax Code should be vetoed.
We assume that this assault about freedom in 1 part of the planet is a challenge for the whole world.
The Council of National Coordination.
Folks First comment: Anybody who considered that democracy within Ukraine had died with the apparent failure of the Orange Revolution ought to think again. This specific call to protest is some sort of spontaneous reaction by means of middle class entrepreneurs who see their very livelihood under threat from unjust and corrupt legislation. To realize the root on this situation we must look at growth and development of the tax collection system throughout Ukraine.
In the mid 1990s your government passed the law that prevented all organization from using cash to help to make even the smallest of payments. On the same time members of exactly the same government set way up cash laundries in which businessmen could buy black market cash with a commission rate of among 2 and 7%. This forced a sizable component of small along with medium sized businesses into the actual shadow economy in addition to created a massive cash generator for those in power as being the commissions certainly would not go to the state budget. What had been worse is of which many of your laundries work inside ‘partnership’ with the particular government thereby creating a ring of fiscal control to fleece entrepreneurs.
In the same time the actual Tax Police ended up formed purportedly to help clamp down upon illegal business ventures. In simple fact cooperation between your laundries and this authorities created the massive network associated with corruption that seemed to be actually supported simply by legislation. This process became the rank quo and actually led to officials providing commercial counselling to be able to companies on precisely how best to mitigate the impact. In various other words the authorities used his or her unique position since legislators to build a wholly immoral as well as corrupt system. This principle architects of this system and the actual legislation that supports it are generally people who get achieved the placement of Prime Minister of Ukraine.
In advance of this kind of new Tax Code parliament about the initiative of the government passed guidelines that will enable legalised capital flight. The financial aristocracy are usually now able to move money offshore to safe havens without fear of punitive taxation or the previous moment consuming licensing.
What the Prime Minister is currently proposing in the particular new Tax Code is the Tax Police become given powers of which take them previously the law. In case this legislation is definitely signed by this President the Tax Police can to all intent have your power to not really subjectively assess the amount of place a burden on they want by each company irrespective of this accounting records and to seize assets with out recourse to the particular courts in your event that the particular company disputes the actual tax claim or perhaps refuses to spend. The only defence for business owners will end up being to bribe the tax police as well as this is exactly what this particular law is designed to obtain. This is tantamount to legalised corporate raiding by their state.
The new Tax Code can easily only be described as state sponsored crime and also clearly explain the basis of this call to national protest. The intent of the actual government is illustrated by simple fact that whilst they sought guidance in the tax committees regarding European Business Association and this American Chamber connected with Commerce in Kyiv virtually none of their particular recommendations were considered into account from the final version of the law. Furthermore this law was discussed in Parliament with no a legal quorum where all around 100 deputies voted illegally in behalf of 296 in get to get your law passed. There were no public conversation as required by means of Ukrainian legislative procedure and no second reading.
Exactly what will be the particular most likely impact of this specific legislation?
• Under the particular combined pressure in the tax police coupled with the lack of lending by the particular banking system little and medium sized enterprises will simply collapse throwing thousands away from work, increasing this pressure on this virtually nonexistent interpersonal security net and also generating yet more poverty and hardship.
• The nation will be thrown into chaos with potentially thousands taking to the actual streets and throughout strikes and stoppages all within the country that the authorities will end up being unlikely to contain without the use of force.
• Tax revenues will fall as a consequence of the chaos, the collapse of organizations and the increase in bribes paid on the tax police
• More of the particular economy will move into this shadow. It will be already estimated because of the World Bank with 50% of GDP, Ukrainian experts predict it could rise to between 70 and also 75% drawing directly into serious question your ability of the State to function at all
• The Tax Police will build warehouses entire of seized business equipment but generally there will be nobody to buy it in addition to therefore no income for hawaii
All that that legislation will accomplish will be to further undermine the SME segment regarding society and enflame a vast percentage with the population. At present the Ukrainian SME industry contributes 16% regarding GDP but attracts 85% connected with tax police interest. In EU countries the SME sector contributes an average of 57% of national GDP without tax police are generally required.
This laws is a action too far; this is an affront to majority rule. It is morally wrong, criminal in its intent and needs to be resisted to this full by the actual people of Ukraine and with the international community.
Many of us fully understand how the current tax laws are ineffective and must be revised but that is not the solution. We appeal on the opposition not to become involved in populism but to offer concrete draft laws aimed at addressing this serious national matter.
We appeal for the President to veto what is a new grossly unfair law that will seriously damage a new key sector with the economy of your nation and to be able to call to account its architects as their intent in your opinion is not really in the national interest.
Most of us further appeal to the European Union as well as the governments of the particular G20 countries in order to recognise that the international financial and offshore corporate methods are being manipulated in Ukraine in get to launder massive amounts connected with stolen money whilst at exactly the same time poverty is now a actuality for 78% associated with Ukraine’s population.