Ukraine: Technical Assistance Report—A Follow-Up on Distributed Profit Tax, BEPS Implementation, Voluntary Disclosure Program, and Indirect Methods for Determining Taxable Income

IMF Staff Country Reports, November 23, 2020

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Ukraine: Technical Assistance Report—A Follow-Up on Distributed Profit Tax, BEPS Implementation, Voluntary Disclosure Program, and Indirect Methods for Determining Taxable Income

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Bibliographic details

• Published: November 23, 2020
• Series: IMF Staff Country Reports
• DOI: https://doi.org/10.5089/9781513561400.002

Executive summary and context

• Tax policy in Ukraine is engaged in two fronts at once: gradual improvement and updating of the tax system, and exploration of fundamental changes to essential tenets of the existing system.
• Modernization efforts include updating the international aspects of the income tax and upgrading the regime to OECD standards.
• A strong policy debate advocates replacing the Corporate Profit Tax (CPT) altogether with a Distributed Profit Tax (DPT), generally referred to in Ukraine as the Exit Capital Tax (ECT).
• The DPT/ECT concept: the system would not tax profits as they accrue to the corporation; instead, it would defer taxation to when the corporation distributes dividends to the shareholder.

Major themes covered

• Distributed Profit Tax (DPT) / Exit Capital Tax (ECT)
  • Central idea: defer taxation of corporate profits until distribution as dividends to shareholders.
• BEPS implementation and modernization of international income tax rules
  • Upgrading the international income tax regime to OECD standards is a stated objective.
• Voluntary Disclosure Program
  • The report addresses elements related to voluntary disclosure mechanisms (no further details in the summary).
• Indirect methods for determining taxable income
  • The report follows up on indirect methods used to determine taxable income (no further details in the summary).

Subjects and keywords

• Subjects:
  • Controlled foreign corporation rules
  • Double taxation
  • Income and capital gains taxes
  • Legal support in revenue administration
  • National accounts
  • Personal income
  • Revenue administration
  • Taxes
• Keywords:
  • CFC rule
  • Controlled foreign corporation rules
  • CR
  • domestic law
  • double taxation
  • Double taxation
  • Global
  • Income and capital gains taxes
  • ISCR
  • Legal support in revenue administration
  • PEM resident
  • Personal income
  • tax authority
  • tax burden
  • tax return
  • taxable income
  • transfer pricing

International Monetary Fund. Fiscal Affairs Dept. "Ukraine: Technical Assistance Report—A Follow-Up on Distributed Profit Tax, BEPS Implementation, Voluntary Disclosure Program, and Indirect Methods for Determining Taxable Income", IMF Staff Country Reports 2020, 302 (2020).

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