The Committee considered the position of IT Ukraine on Diia.City

The Committee considered the position of IT Ukraine on Diia.City

On June 18, the Digital Transformation Committee considered all proposals and amendments to Diia.City. In total, the bill on stimulating the development of the digital economy in Ukraine received 358 amendments from people’s deputies. Following the meeting, the committee recommended Verkhovna Rada to adopt the draft Law № 4303 in the second reading and as a whole with editorial and technical-legal revision of its text.

We would like to remind you of the “critical lines” of the IT Ukraine Association, which it defended as obligatory during the implementation of the Diia.City project:

  1. Preservation of the declared tax burden for 15 years: 5% income tax for specialists, SDR 22% from one minimum wage, military tax 1.5%;
  2. Protection of private individuals outside of Diia.City to prevent pressure on IT companies to join Diia.City;
  3. Possibility to work with private individuals for residents of Diia.City for at least three years, in case the resident company uses the withheld capital tax, without restrictions and additional taxation of such interaction;
  4. Change the requirement for a mandatory annual audit to providing standard financial statements for small and micro-businesses;
  5. Possibility to suspend the decision to deprive the company of the status of a resident of Diia.City by the authorized body (Ministry of Digital Transformation) until the court decision.

Bill № 4303 was registered in Parliament on November 2, 2020. At the same time, the IT Ukraine Association developed several proposals and comments that formed the basis of an alternative bill № 4303-2. It was registered in the Verkhovna Rada with the support of business associations ACC, EBA and SUP. However, on March 3, people’s deputies rejected an alternative bill from the IT industry.

On March 17, an updated version of the bill № 4303 on a special legal regime for the IT industry Diia.City was presented. It took into account some, but not all, proposals from the IT industry. Bill №4303 was adopted in the first reading but needed to be finalized by working groups of people’s deputies and all critical changes from the IT industry needed to be considered. Currently, all critical changes from the IT industry have been taken into account.

On May 13, the Committee of the Verkhovna Rada of Ukraine on Finance, Taxation and Customs Policy supported Bill № 5376, which establishes the tax conditions of the Diia.City regime. Following the meeting, the Committee decided to recommend to the Verkhovna Rada to include this bill in the agenda of the fifth session of the ninth convocation, as well as to adopt it as a basis after consideration in the first reading.