Changes In Tax Legislation Of Ukraine

On 31 March 2014, Law of Ukraine "On preventing financial catastrophe and creating grounds for economic growth in Ukraine" No. 1166-VII dated 27 March 2014 (the "Law") came into effect. The Law provides for, inter alia, substantial changes in the taxation regime of individuals and legal entities, in particular:

• corporate income tax rate is fixed at 18% (earlier a decrease to 16% was planned);
• value added tax (VAT) rate also remains at 20% (earlier a decrease to 17% was planned). In addition, sales of pharmaceuticals become subject to 7% VAT from 1 April 2014. At the same time supply within the territory of Ukraine and export of grain and technical crops is free from VAT until 1 October 2014;