ÁREA DE GESTIÓN Y PLANIFICACIÓN DE LOS RECURSOS HUMANOS

The customs value of goods imported into Ukraine is the basis for calculation of the import custom duties and taxes and normally includes the cost of goods, insurance costs and transportation costs of the goods up to the Ukrainian customs border. Depending on the actual circumstances, including contractual arrangements, a Ukrainian importer of record in addition to the aforementioned costs may be required to include royalties (payable for the right to use trademarks and other IP rights) into the customs value of those goods, provided that the Ukrainian importer must directly or indirectly (e.g., via third parties) pay those royalties, other license fees and/or other income as a condition/direct consequence of importation of the goods being valued at customs.

The Customs Code provides an exhaustive list of documents to be filed for determining the customs value of goods. The code precludes

the fiscal authorities from requesting documents other than those on the list. The Customs Code establishes an exhaustive list of cases when the customs value may be viewed to be incorrect: (i) the

customs value is computed improperly, (ii) not all documents required under the list are filed, (iii) the valuation method applied by the importer of record is inconsistent with the terms prescribed by the Customs Code, or (iv) receipt by the fiscal authorities of official information from foreign fiscal authorities regarding the falsity of the declared customs value.

7.8.1 Import and export customs duties

Customs duties are imposed on top of the declared customs value of imported goods confirmed and accepted by the customs. Rates of import customs duties in Ukraine normally range from 0% to 60% according to the Ukrainian Customs Tariff. Ukrainian customs legislation establishes three levels of rates for the payment of customs duties on imported products.

A preferential rate of customs duties (as well as an exemption from the payment thereof) is applied to: products originating from countries with which Ukraine has entered into a customs union; products originating from countries with which Ukraine has created special customs zones; or upon the establishment of a special “preferential” customs regime pursuant to an international agreement of Ukraine. Reduced rates of customs duties are applied to goods originating from countries and economic unions which have been granted most-favored nation regime in Ukraine.

Customs duties are payable in full for all other goods and products not covered in the two categories described above.

Import customs duties should apply to the customs value of imported goods and may be deducted for corporate income tax purposes. Export duties are levied only for certain limited categories of products (e.g., livestock, oil seeds, waste and scrap of ferrous metals, gas, etc.).

7.8.2 Import VAT

As established under the Tax Code, generally the import of goods is subject to Ukrainian VAT at the general rate of 20%, with a special 7% rate being applicable to permitted medicines and medical products, levied on top of the tax base for imported goods.

For the purpose of VAT the tax base for goods imported into Ukraine should be determined based on their contract price but not be lower than their customs value. The excise tax and import customs duty are to be added to the customs value of imported goods for the

determination of the tax base for VAT.

The customs value should include the following costs incurred by the importer or to be paid by the importer for the imported goods, which should be added to the contract price: (i) transportation, (ii) loading/ unloading, (iii) insurance; (iv) brokerage, agency, commission, other fees; and (v) payments for the use of intellectual property (royalties). The cost thus determined shall be converted into Ukrainian hryvnia at the National Bank of Ukraine exchange rate effective as of 00:00 of the day when a customs declaration is filed or the customs formalities are carried out (if no customs declaration is filed).

The following goods imported into Ukraine may be exempt from import VAT:

• Art and cultural goods;

• International technical assistance;

• Fish caught by ships registered in Ukraine;

• Goods and commodities designated for the use of diplomatic and consular offices and their personnel.

Import VAT may be generally offset against output VAT collected from local customers.

7.8.3 0% Export VAT

Export of goods is generally subject to 0% VAT. VAT exempt supplies deprive a VAT payer of the right to claim input VAT. Export VAT should be determined based on the contract price, which may not be lower than the purchase price of the goods or, if they were produced by the taxpayer, not lower than an arm’s length price. For VAT purpose goods are viewed to be exported if and when their export is evidenced by the customs cargo declaration. More

specifically, in order to confirm the export operation subject to 0% VAT, the taxpayer must file the original of the customs cargo

declarations with the stamp of the customs office confirming that that export operation is completed.

In addition to the stamped custom declaration, the following main documents should support the export operation:

• The contract for the export of goods; • The payment documents;

• The shipping documents (transfer and acceptance statements, waybills, invoices, etc.).

VAT should arise only if the actual shipment of the exported goods (i.e., transfer across the custom border) supported by the customs declaration is executed.

7.8.4 Import Excise Taxes

Please refer to section 5.10 above for a discussion of excise taxes payable in Ukraine.