The tax compromise law is not fully operational through several subjective factors
Law No. 63-VIII “On Amending the Tax Code regarding the specifics of clarifying tax liabilities for corporate income tax and value added tax in the case of a tax compromise” (Law on tax compromise), which was adopted on December 25, 2014, is a long-awaited business, positive and progressive in nature, although it has some disadvantages.
So, for example, criminal lawyers comment that it is negative that the Law does not define an exhaustive list of cases (grounds) when regulatory authorities would have the right to appoint and conduct tax audits as part of the application of the tax compromise procedure.
Also, the Law does not say anything about in what cases and under what circumstances the regulatory authorities can refuse the taxpayer to apply the tax compromise procedure. The consequence of this is the numerous facts of far-fetched and unreasonable refusals to apply this procedure.
But, in my opinion, the main reasons that the Law on the tax compromise did not work in full force are subjective factors.
First of all, on the ground, the regulatory authorities expanded the provisions of Law No. 63-VIII regarding the boundaries of the tax compromise procedure, taxpayers categorically warn that either they include in their statements of intent to apply the tax compromise all risky, from the point of view of the controlling authority, business transactions , or an unscheduled tax audit will be inevitably scheduled, as a result of which all these “risky” business transactions will be included in the act “without the right to appeal I am. ”
Although, this is the rare case when the Guidelines for the application of Law No. 63-VIII, approved by order of the Fiscal Service of Ukraine No. 13 of 01/17/2015, positively expand the norm of this law, from which it follows that verification is carried out exclusively within tax periods and business entities for business transactions with which the taxpayer submitted clarification calculations.
Another limiting subjective factor is that among business representatives there are unreasonable fears regarding the consequences of applying the Tax Compromise Law, in particular, concerns that voluntary recognition of the fact that tax obligations are understated by the taxpayer will actually be a confession, as a result of which the company official, in case of refusal by the controlling body to apply a tax compromise to the taxpayer, in the future it may be involved criminal liability for tax evasion, and can also be the basis for prosecution under other articles of the Criminal Code of Ukraine.
Also, the concerns of business representatives relate to the fact that, when deciding on the application of a tax compromise, the taxpayer puts his counterparties in jeopardy and entails negative consequences for them.
Unfortunately, among individual lawyers such “horror stories” are also common.
I want to confidently note that these fears are complete nonsense.
Firstly, the fact of applying the tax compromise procedure cannot even be objectively interpreted as voluntary recognition in any illegal actions, since the law on the tax compromise only regulates the procedure for its approval, while it does not impose any conditions for its application, the more and does not set the achievement a compromise depending on the recognition of guilt, and therefore the fact that the payer uses such a procedure can in no way be regarded and interpreted as voluntary admission of guilt by him than. On the contrary, the achievement of a tax compromise is the indisputable basis for the closure of criminal proceedings in connection with the absence in the actions of the officials of the enterprise of a corpus delicti provided for in Art. 212 of the Criminal Code of Ukraine.
Secondly, Law No. 63-VIII contains a clear rule that clarification of tax obligations by a taxpayer by submitting a more accurate calculation does not affect the amount of tax obligations of its counterparties.
Given the above circumstances, as well as the appeal of taxpayers, the Association of Taxpayers of Ukraine requested the Committee of the Verkhovna Rada of Ukraine on Tax and Customs Policy to provide clarifications to the Committee regarding the application of the Law on Tax Compromise, since the interpretation of its individual norms is ambiguous in practice.
From the clarification of the Committee issued on March 10, 2015, in particular, it follows that a tax audit in accordance with tax compromise procedures for periods for which a documentary audit has already been carried out on the same issues of the taxpayer who has submitted a more accurate calculation cannot be intended by the controlling body .