One of the Bill Sponsors, the People´s Deputy Ivan Zayats, says that the Bill ‘seeks to establish and implement a mechanism for public control of the income and expenses of those persons on whose decisions the very existence and advancement of our country depend´.
Under this Bill (Reg. No.1429-1), a Declarant´s income shall include ‘monies, property, services, property and non-property rights, acquired from any source, both within and beyond Ukraine, or from property entities (their authorized bodies or agents).
Attributed to Declarants shall be Ukraine´s Senior Officials, 1-3 Category civil servants, Chairmen and Deputy Chairmen of City, Regional and District Councils, including persons occupying the above position in the past, apart from those who were dismissed more than ten years ago, together with their family members. i.e. husband/wife and direct relatives (parents, children, including adopted and those in guardianship) of both the person at issue and his/her wife/husband, and children, wife/husband of all direct relatives.
The Bill purports that State control of income declaration and expenses of the said persons shall be executed by the State Tax Service, using direct and indirect methods, including income statement data verification and record data; surveys among taxpayers and other persons; through the obtaining of other information using legal methods, to verify income statement accuracy and comprehensiveness. State Authorities and Local Governments, Banking and other institutions, companies, organizations or authorized persons within their competence shall assist the State Tax Service bodies in administering financial control of income and expenses as stated by the Declarants.
The Bill establishes the minimum total of expenses, subject to declaration by Senior Officials in Ukraine,1-3 Category Civil Servants, Local Government leaders and their families, and control by State Tax Service bodies, as being greater than 100 minimum untaxed incomes. Subject to declaration shall also be data on monies, property, goods and services obtained free of charge, or borrowed for temporary use. Declarants may also show in their Statements expenses below 100 minimum untaxed incomes.
During these discussions, S. Teriokhin, Committee Chairman, noted that the State Control methods, envisaged in the Bill to control Declarants' income, property and expenses, ‘can lead to a sophistication in administration of such declarations, and increase Budget expenditure towards the funding the State Tax Service´.
The People´s Deputies also feel that ‘an extended range of the Declarant´s family members, together with a requirement to complete a Joint Income Statement, makes this task complicated, and is not consistent with the Law ‘On Income Tax on Natural Persons´, envisaging an individual Income and Property Status Statement to be submitted by each natural person.
A number of other criticisms were also voiced. The Committee considers the Bill ‘topical, and aimed at promoting the combatting of corruption and concealing of income from taxation. Nevertheless, Committee members feel that it requires additional elaboration.