News

Businesses in Ukraine face one of the most challenging tax environments in the world

December 2015


Published annually, the World Bank Doing Business project provides objective measures of business regulations for local firms in 189 economies worldwide. The latest report, Doing Business 2016: Measuring Regulatory Quality and Efficiency, shows businesses in Ukraine are spending 350 hours per year in meeting their tax compliance obligations: well in excess of the average for Europe and Central Asia, at 232.7, and almost double the OECD average of 176.6.

Ukraine’s performance here is among the worst in the region, with only Albania (357 hours), the Czech Republic (405 hours) and Bulgaria (423 hours) performing worse.

Member firms of the Russell Bedford International accounting and tax consulting network, including Russell Bedford member firm Riqueza Capital Group, Kiev, contributed data to the report’s Paying Taxes survey. This year’s Paying Taxes report highlights the importance of electronic filing, citing more than 85 per cent of jurisdictions in Europe now allowing online submissions, in contrast to less than 30 per cent in 2006.

Iryna Shtefano, managing partner, commented: “The government, together with tax professionals, has made some significant changes to Ukraine’s tax regime in 2015. Their efforts, however, were mostly focused on fighting tax fraud and building horizontal equity (making sure individuals and businesses with similar levels of income pay similar levels of tax). Those changes that would make tax compliance easier and less time-consuming are still to come.”