Today the Verkhovna Rada adopted amendments to the Tax and Customs Codes under the pretentious title “On the Support of Cinematography in Ukraine”. However, in the opinion of Tetiana Ostrikova – people’s deputy of the Samopomich Union – this title does not completely correspond to the content of the voted bills.
“Undoubtedly, the state should introduce incentives and allocate money to support Ukrainian cinematography. To my mind, these incentives should be reflected in the State Budget in the form of direct subsidies to the movie-making industry. However, the changes to the Tax and Customs Codes exempt from VAT and import duty the imported products intended for use in cinematography – digital and other cameras, lighting devices, in particular lamps, floodlights, and other devices that can be used not only for the filming of movies,” said the people’s deputy.
In addition, the law states that the procedure for using exemption from taxation on imported goods will be determined by the Cabinet: “Who can be completely sure that the government order will be effective if there is no one to check the targeted use of the imported products that will receive benefits? Who believes that the government order will really make it impossible to abuse these benefits? We already have such examples of government orders, in particular concerning agrarian subsidies, when the government’s order provided for two regulations that made it possible for large agricultural holdings to receive agrarian subsidies in 2017.”
Also, as explained by Tetiana Ostrikova, the bill creates certain prerequisites for tax abuses in the payment of royalties to non-residents when the rights to films and foreign television programs are bought. In particular, now, according to the Tax Code, it is considered that the non-resident who sold them is the beneficial owner of such royalties.
Samopomich supports the development of Ukrainian film industry, creation of films and TV shows in Ukraine. However, the state should first of all take care of its filmmakers, directors, actors, script writers in order to ensure that quality product is created in Ukraine, instead of providing benefits on imported products.