UkraineAccounting and Audit
The State Customs Committee has issued an instruction to all customs points with effect from 1 January 1996 ordering them to collect excise duty, import VAT and customs duties on imported excisable goods, regardless of the purpose of the import. This measure is aimed at stopping the flow of contraband excisable goods (mainly cigarettes and alcohol). An unfortunate side effect is that motor cars (which are excisable goods) are also caught by the order. It therefore appears that the order of the Customs Committee conflicts with the Foreign Investment Regime Decree of 1993 and 3 years' previously established practice at customs which allowed assets to be contributed to the statutory fund of a joint venture without payment of excise duty, import duty or import VAT. This means that foreign partners contributing motor cars to the statutory fund of their joint venture in Ukraine will find taxation levels upon import massively increased. (Order of the State Customs Committee No 18 of 17
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