Tax amnesty has failed

Since September 1, a one-time voluntary declaration of assets has been underway in Ukraine. Ukrainians declared UAH 1.67 billion in half a year. Revenues to the budget from one-time fees amount to UAH 95.6 million.

The authorities expected that the amnesty would be able to bring out of the shadows approximately 20 billion dollars. In half a year, the plan was fulfilled by 0.3%. This indicator shows that, as we predicted, the voluntary declaration campaign failed.

The effectiveness of amnesty as an instrument to way out of shadow economy is questionable. Before it was introduced, it was necessary to solve the problems that encourage Ukrainians to avoid paying taxes and fees. This is a high tax burden, corruption, and non-transparent administration.

In addition, many citizens may not dare to take advantage of the amnesty due to a low level of trust in law enforcement and tax authorities.

The government, as always, started with the consequences, not the causes. And the results of this are quite expected.