The Bill (Reg.No.1031) proposes the inclusion into total costs, and hence taxation, of ‘amounts of monies remitted by employers to Trade Union organizations, towards cultural, physical training and health improvement schemes, in amounts as specified in the Labour Team Agreements between employers and employees, but no less than 0.3 percent of the Labour Remuneration Fund.
Serhiy Teriokhyn, Committee Chairman, emphasized that the said costs do not belong directly to the costs related to business activities of a tax-payer and are not attributed to obligatory payments listed in the Law ‘On Taxation System´.
Those taking the floor during discussions noted that the Law ‘On Trade Unions, their Rights and operation guarantees´, defining the amount of funds remitted towards cultural, physical training and health improvement schemes, and stating the obligatory nature of such remittances, does not belong to specific laws related to taxation. It defines Trade Unions as voluntary non-profit civic organizations uniting citizens with common interests'.
Committee members feel that since Trade Unions are non-profit organizations, employers and tax-payers have the right to attribute monies remitted to Trade Unions towards cultural, physical training and health improvement schemes to a total cost, within limits set out in the Law ‘On Income Taxation of Businesses´, i.e. an amount above 2 percent but not higher than 5 percent of taxed income of the previous financial year.
The amount envisaged in the Bill (not less than 0.3 percent) is unlimited with respect to taxation, thus creating conditions for tax reductions.
The Budget will be depleted by UAH 191,500,000 in the event that this Bill is adopted, as the estimate by the Ministry of Finances of Ukraine shows.