The Verkhovna Rada of Ukraine has passed bill No. 3238-d on amending Ukraine’s Tax Code regarding state support for filmmaking in Ukraine.
A total of 228 lawmakers voted for the relevant bill at a plenary meeting on November 7.
Authors of the bill propose lifting value-added tax on operations involving the production of national films, as defined in Ukraine’s law on cinematography, as well as granting tax-free labor and services, through January 1, 2023.
Transitional statutes in the current Tax Code provide VAT-free status through January 1, 2016.
In addition, the draft law suggests VAT-free status through January 1, 2023 for film showings, as well as the distribution of national and international films, which are dubbed into the state language in Ukraine.
In addition, the bill proposes to amend the Tax Code in terms of determining the non-beneficial owner for regulating the specifics of work in film industry.
According to the explanatory note, the changes are related to the adjustment of the financial result (reduction or increase) to more clearly display the subsidies received by the taxpayer – the participant of Ukraine’s film industry – for refunding part of the expenses.
The bill also suggests not including the amount of paid royalties in the financial result in case the item covered by copyright originated in Ukraine and then was transferred abroad taking into account the specific nature of film industry.
The parliament also suggests not levying taxes on the payments for goods and services to film actors, namely, travel, accommodation, food, insurance, training related to the production of an audiovisual product by Ukrainian filmmakers.
The Verkhovna Rada also passed bill No. 3239-d on amending Ukraine’s Tax Code regarding state support for cinematography in Ukraine.
The document was supported by 228 lawmakers.
The bill proposes freeing from customs duties through January 1, 2023 goods imported in Ukraine as part of the national cinematographic heritage, as well as goods intended to be used in filmmaking.
In particular, the bill suggests duty-free import to Ukraine of movie cameras, film projectors, equipment for sound recording and reproduction, television cameras, digital cameras, film stock, projector reels, equipment for photo and film laboratories, and lighting equipment.
In addition, the Verkhovna Rada backed the decision to send for the second reading the draft law on amendments to the Budget Code of Ukraine on state support for filmmaking in Ukraine (No. 3240) dated October 3, 2017.
Some 228 lawmakers voted for the corresponding decision.
