Only 8% of Ukrainian business specialists consider Ukraine's current tax system to be favorable for business development, according to an annual Tax Index by the European Business Association (EBA) and the EY Ukraine published on Dec. 14.
Some 52% of surveyed experts rated the tax system as satisfactory, while 40% believe it hinders business development and investment attraction.
The overall assessment of the tax index decreased to 2.85 of the five-point maximum compared to 2.97 last year.
Tax legislation was rated at 2.63 points. Around 39% of respondents evaluated it negatively and 52% as satisfactory.
The number of experts considering the legislation to be of high quality has decreased from 26% to 9% compared to the previous year.
"According to respondents, constant changes, contradictions, and ambiguous provisions and their complexity have the greatest negative impact on the quality of legislation," the report said.
Tax administration procedures were rated with 2.67 points, while 42% of respondents described them as burdensome, 41% as satisfactory, and only 17% deemed them easy.
The quality of tax services was given 3.03 points, and the assessment of fiscal pressure was rated at 3.07 points, the highest score of all topics.
Respondents nevertheless noted an increase in fiscal pressure compared to last year, connected mainly to unjustified interpretations of tax legislation by controlling bodies.
The survey was carried out with the involvement of 75 tax and finance specialists from EBA's member companies between Nov. 14 and Dec. 1.
President Volodymyr Zelensky signed two tax-related bills on Dec. 6.
One of the new laws has increased the profit tax for banks from 18% to 50% in 2023 and set the rate at 25% starting from 2024 as Kyiv seeks to meet growing military expenses.
The country has also resumed tax audits of businesses, which have been on hold since the start of the invasion.
Elsa Court
