The Kyiv City Council’s Standing Committee for budget issues and the socio-economic development approved the project of reducing a size and a new procedure for paying share contributions in Kyiv. The project provides for reducing the “investment tax” from maximum 10% to 4% for both residential and non-residential buildings. A formula to calculate the share contribution size is also changed.
The adoption of the new procedure completely defeated arguments of the same Kyiv City Council regarding the impossibility to reform an issue of paying share contributions in cities’ infrastructure. On November 15, the bastion of corruption and ineffective “manual” regulation began to show signs of serious strain. It became easier for honest and non-corrupt real estate developers to obtain the “access to the market”.
However, the compromise decision on reducing share contributions is only the first step towards the complete abolition of one of the most corrupted and uncontrolled charges for the business. It demonstrates – THE COMPLETE ABOLITION OF “INVESTMENT TAX” is not only possible, but also beneficial to the state. For this purpose, the government just needs to start thinking strategically and lay aside personal desires to “manually” regulate business charges.
Kyiv joined many cities of Ukraine, which have long started to implement reforms in this area. Local authorities become business-oriented little by little. The state should make the next step.
Lawmakers in the Verkhovna Rada of Ukraine should make their final choice – either to preserve corruption and pressure on investors or support the reforms and open the door for investments. Approving the draft law #3610 regarding the complete abolition of share contributions is an ultimate goal of the first step, which was made in the bastion preventing investments and development of the construction market!
We thank Olga Balytska for her perseverance in defending the community’s rights for reforms and hope that soon we can completely get rid of uncontrolled “investment exactions” by adopting the draft law #3610 regarding the complete abolition of share contributions.