On July 1, draft law No. 7418 on amendments to the Tax Code of Ukraine and other legislative acts of Ukraine regarding revision of certain tax benefits enters into force.

The adoption of this law makes background for canceling the list of critical import goods, which has been in effect since the beginning of the Russian invasion.

From the beginning of russia's full-scale war against Ukraine, the NBU decided to limit currency payments abroad and allowed payments only for the list of critical import. The specified list was approved by a resolution of the Cabinet of Ministers of Ukraine.

The list of critical import goods has been revised for 18 times, as it was needed by the Ukrainian businesses, which have renovated production. Practically all changes to the resolution on critical imports were made on the basis of appeals from Ukrainian companies. Today, the list of critical import goods includes about 90% of all product categories.

"The adoption of draft law 7418 by the Verkhovna Rada makes it possible to apply an alternative mechanism for balancing the outflow and inflow of foreign currency to the state through the collection of duties and taxes on imports. It is about the renewal of taxation for goods imported by taxpayers of the first, second and third groups of single tax, for enterprises that do not pay import duty, as well as for cars imported by citizens. After that, the critical import program can be completed. The economy has been developing and needs more and more imported goods and raw materials. After the National Bank removes restrictions on the purchase and transfer of foreign currency abroad for the purchase of critical import goods, the government, for its part, will cancel the resolution on the list of critical import goods," said the First Deputy Prime Minister of Ukraine - Minister of Economy Iulia Svyridenko.

According to her words, the increase in imports will create additional incentives for business recovery, improve the efficiency of Ukrainian production, and increase Ukraine's investment attractiveness. The final consumers will also benefit, who will have a wide range of products and will be able to choose the highest quality of them.

"The entry into force of the law creates prerequisites for the abolition of restrictions on the purchase of foreign currency and cross-border remittances for the import of goods by the NBU. At the same time, in the conditions of martial law, we consider it reasonable to maintain restrictions on the purchase of foreign currency and cross-border remittances for the import of services,"-  said NBU Chairman Kyrylo Shevchenko.

The renewal of duties and taxes on the import of goods and services is an important step on the way to restoring the ability of the foreign exchange market to self-balance. In particular, this will support the further recovery of production in Ukraine and will make it possible to limit the rate of import growth, which puts pressure on the foreign exchange market and Ukraine's international reserves.

Besides this, monthly revenues to the state budget will increase. According to the estimates of the Ministry of Economy, they will increase by 3,5 billion  UAH. This will contribute to the reduction of the financing of the budget deficit by the National Bank and, accordingly, to the reduction of devaluation pressure.

Reference source: Ministry of Economy of Ukraine