TAX ALERT 23.07.2025 | Digest of Key Tax News

Draft Law on the extension of the preferential import regime for electric vehicles registered

On June 06, 2026, the Verkhovna Rada of Ukraine registered draft law No. 13351 “On Amendments to clause 64 of subsection 2 of section XX “Transitional Provisions” of the Tax Code of Ukraine regarding the extension of the preferential import regime for vehicles equipped exclusively with electric engines”.

The draft law proposes to extend the VAT exemption for transactions involving the import and supply within the customs territory of Ukraine of vehicles equipped exclusively with electric engines until January 01, 2027.

Currently, under the effective version of the Tax Code of Ukraine, this exemption remains in force until January 01, 2026.

The State Tax Service of Ukraine provided clarifications regarding the confirmation of VAT exemption on the import and supply of goods, the final recipients of which include, among others, military formations

The State Tax Service of Ukraine published clarifications on its Public Information and Advisory Resource regarding the confirmation of the final recipient for the purpose of applying VAT exemption on the import and supply of goods within the customs territory of Ukraine to military formations, enterprises that are contractors for state defense procurement contracts, etc.

The tax authority clarified that the document confirming the application of the VAT exemption regime in the stated case shall be either the contract or an end-user certificate indicating the relevant entity as the final recipient.

No other documentation is required to confirm the application of such a regime.

A review of recent case law of the Administrative Cassation Court of the Supreme Court for April 2025 was published

On June 03, 2025, the Supreme Court published a review of the relevant case law of the Administrative Cassation Court of the Supreme Court for April 2025.

In particular, the Supreme Court:

• emphasized the necessity to prove the taxpayer’s fault when imposing increased penalties for late tax payment.

In its ruling in case No. 280/3447/23, the court stated that general assumptions or unsubstantiated allegations of intent are insufficient to impose increased fines.

Also, it was noted that arguments without proper evidence of inability to fulfill tax obligations due to presence in a combat zone are not sufficient to exempt the tax payer from liability;

• noted that the Acting Deputy Head of the State Tax Service of Ukraine has the right and legal authority to sign an order on the appointment of an unscheduled on-site inspection and to delegate its execution to territorial bodies of the State tax Service of Ukraine.

In case No. 140/5720/24, a challenge was made against the order signed by the Acting Deputy Head of the State Tax Service of Ukraine regarding the appointment of an unscheduled on-site inspection. The inspection was to be conducted by the Main Department of the State Tax Service in the Volyn region, with the involvement of employees from the Main Department of the State Tax Service in the Lviv region (in accordance with the control over the actions of lower-level tax authorities).

The Supreme Court confirmed the legality of the Acting Deputy Head of the State Tax Service of Ukraine’s authority to sign the order, considering the lawfulness of such a delegation of authority to the respective individual;

• paid attention that the absence of registration of a loan agreement with a non-resident or any amendments thereto within the National Bank of Ukraine does not constitute grounds for recognizing such agreement as invalid or non-performing and does not justify including the loan amount in taxable income.

In its ruling in case No. 520/7077/2020, the Supreme Court noted that a loan agreement with a non-resident remains valid unless declared invalid by a court and provided it does not violate legal requirements. Lack of registration within the National Bank of Ukraine does not affect the validity of the agreement, as such registration is a currency control measure established by a subordinate regulation, not a law. Therefore, state registration of transactions is mandatory only where explicitly required by law. A transaction does not lose its validity due to non-compliance with a requirement imposed solely by a subordinate act.