Verkhovna Rada voted for a 10-year income tax exemption for industrial parks

The Verkhovna Rada passed in the second reading bills №5688 and №5689, which provide a number of new tax and customs benefits for industrial parks, MP Yaroslav Zhelezniak wrote in his Telegram.

236 and 230 deputies, respectively, voted for the bills №5688 and №5689.

“VAT has now been abolished on the import of new equipment. Also, residents of the industrial park exempted from income tax for 10 years,” he wrote following a parliamentary session on Tuesday.

On April 19, the Committee on Tax and Financial Policy of Verkhovna Rada amended and supported in the second reading the bills №5688 and №5689.

The following amendments have been made to the bills:

• the procedure for collecting profits has been regulated, and the list of goods that can be imported by participants of industrial parks without payment of customs duties has been finalized;
• restrictions have been imposed on the creation of industrial parks and the participation of economic entities related to economic relations with the aggressor state.

Bills №5688 “On Amendments to the Tax Code of Ukraine on Creating Favorable Conditions for Attracting Large-Scale Investments in Industrial Production” and №5689 “On Amendments to the Customs Code on Creating Favorable Conditions for Attracting Large-Scale Investments in Industrial Production” include:

• exempt the import of new equipment for own use by the industrial park from VAT (for carrying out activities in the processing industry or research activities);
• exempt residents of the industrial park from income tax for ten years;
• local authorities right to set preferential rates of real estate tax and land fees.

Both bills were registered in June 2021.

In early September 2021, on the first day of the sixth session, the Verkhovna Rada adopted in second reading bill №4416-1 “On Amendments to the Law of Ukraine “On Industrial Parks “, which provides a number of investment incentives for the residents of industrial parks.

Bill №4416-1 provides compensation of the cost of connection to electricity networks and other communications of 50% and compensation from the state budget share of capital investment from 15% to 70% in the first three years, depending on exports, for the residents of industrial parks.

In October, Ukrainian President Volodymyr Zelensky signed the law, and the document officially entered into force.