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What Will Happen After Mr. Nasirov?

nasirov

According to experts, the business relies not only on the reformatory spirit of the new head of the State Fiscal Service, but on reducing the tax authority`s power and automation of the processes.

Chairman of the State Fiscal Service (DFS) Roman Nasirov was on the 3th of March suspended from his duties on suspicion of rendering unreasonable tax postponements to companies of former MP Oleksandr Onyshchenko. He is not fired yet. Mr. Myroslav Prodan temporarily manages the DFS, but Mr. Nasirov is still the tax organization’s head and will occupy the post until the official quit.

CASE Ukraine Senior Economist Volodymyr Dubrovsky commented to ‘Focus’ magazine on the resignation of Nasirov: ‘The main task set by Finance Minister Danyluk is to carry out a global, deep reform and destroy Mr. Azarov-style economics’. Of course, the Nasirov case has made Danyluk closer to solving of this problem.

At the same time the business community understands that all the good steps of the Ministry of Finance, — despite the fact that they are written in the legislation, — can be incarnated into reality only with the support of the Presidential Administration of Ukraine. As the respondent entrepreneurs and experts fear, the Bankova Street may impede reforms of the fiscal authorities as tax revenues and penalties remain to this day one of the main items of the budget.

Another initiative, which implementation one may tie with the resignation of Nasirov, is introduction in July 1 of the system which automatically stops the registration of the tax invoices. However, again in a test mode. According to Volodymyr Dubrovsky, automatization of the process will deal with the so-called ‘twists’ — it is a fraud in the VAT refund. ‘It is an integral part of the automatic VAT refund. You can not automatically compensate the tax if it was not fairly paid by all counterparties,’ the economist explains.

However, as in the case of an open register, test operation mode of the invoices block system has shown that not all decisions are objective as they are still taken by people, especially by a special commission at DFS. It is formed from officials of fiscal service.

In addition, one of the reasons for blocking will be discrepancies in input and output codes of goods and services. Using it, fiscals intend to catch ‘twisting’. But, again, the base of codes of goods and services has not yet been formed. So, locking on this basis is also impossible.

May 18, 2017