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    Mikhail Tretyakov: SOCAR Ukraine one of the initiators of retail excise abolition

    Illegals set fuel prices significantly below market, diminish healthy competition

    Kiev. 23 January. REPORT.AZ/ In late December, Verkhovna Rada of Ukraine passed a bill at the second reading on changes to the Tax Code, which involves the abolition of excise duty collection from retail sales and growth of base rates of excise duty.

    "For SOCAR Ukraine and other responsible members of the Ukrainian market of petroleum products abolition of excise duty has been one of the most important topics for dialogue with the government in the past few years".

    Report informs, Chairman of the Legal Support Department of SOCAR Ukraine Mikhail Tretiakov said commenting on changes in national legislation.

    According to him, immediately after the introduction of the tax on retail sales of excisable goods market in 2015 operators have expressed concerns about the risks of corruption, as well as to predict the development of the shadow segment."Heyday" of illegal filling stations and gas stations eloquently confirmed fears of oil traders. By avoiding to pay not only retail excise tax but also VAT and income tax, "illegals" set fuel prices significantly below the market level that diminishes healthy competition.Meanwhile, the state, according to some estimates, received 6 billion UAH less than one’s due."

    M.Tretyakov noted that group of companies SOCAR Ukraine together with the Association "Union operators of petroleum products market of Ukraine" has taken the initiative to abolish this tax: "Companies were able to ensure that the Verkhovna Rada of Ukraine adopted the draft law No5132 about the changes to the Tax Code, which abolished the excise tax to retail sales. At the same time, in order to avoid budget losses, the legislator has increased basic rate of excise duty on import of fuel and the production."

    He said that equal market conditions are originally winning attitude for SOCAR: "We are confident in the high quality of our products, services and approaches to doing business. As soon as the price distortions will be eliminated, then we will see fair competition - positive results for our company and all market participants, including the state and consumers."

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