New mandatory requisite in the tax invoice “number and date of the customs declaration under which the customs clearance of goods imported into the customs territory of Ukraine was carried out” and the consequences of its introduction
On August 12, 2012 amendments to Article 201 of the Tax Code came into force, which envisage an indication of number and date of customs declaration (hereinafter referred to as the “Customs Cargo Declaration”) in the tax invoice under which the customs clearance of goods imported into the customs territory of Ukraine was carried out. However, on the effective date of the said amendments the form of the tax invoice was not changed by the State Tax Service of Ukraine.
Law on Amendments to the Tax Code does not envisage transitional or special provisions on the moment of this rule application, as well as on the applicability of these rules to goods that were imported before the mentioned requirement came into force.
The requirement to indicate the data on Customs Cargo Declaration in the tax invoice shall be recognized as very burdensome and difficult for fulfillment. Most of the goods imported to Ukraine are generic goods that are regularly supplied under different Customs Cargo Declaration. Therefore, it is almost impossible neither to prove nor to disprove the fact that a particular product was imported under this particular Customs Cargo Declaration, not the other one. Thus, the tax authorities in most cases will have the possibility to ask the seller the questions regarding the proof of import of goods under the particular Customs Cargo Declaration, specified in the tax invoice.
Besides, the law does not prescribe whether it is necessary to specify the number of the Customs Cargo Declaration in the case of return, for instance, of seasonal goods, from trade networks to suppliers (manufacturers, importers). Therefore, one shall proceed from the fact that the requirement to specify the Customs Cargo Declaration in the tax invoices applies to all cases of movement of imported goods, including their return, if tailored as reverse sale.
Considering the current practice in the courts, it is the taxpayer who must disprove statements of the tax authorities, not on the contrary as envisaged by the procedural legislation. Therefore, it is reasonable to presume that in the nearest future the tax authorities will start challenging the tax credit of the buyer of imported goods based on the grounds that the data on the Customs Cargo Declaration does not correspond to the facts, and, therefore, no properly executed tax invoice is available. How to prove in such case that the Customs Cargo Declaration is indicated correctly, if the buyer did not directly import goods or if the importer himself does not have the possibility to prove the contrary (which is logical during executing dozens of Customs Cargo Declarations per month on the same generic product, i.e. the product that has no individual differences).
Therefore, if there is no confidence in the Customs Cargo Declaration under which a particular product was imported, we are to suggest the following algorithm of actions:
- stop executing the hard copy of the tax invoices;
- not to specify the data on the Customs Cargo Declaration or specify any data (other than the Customs Cargo Declaration data) in the electronic tax invoice that is sent to the State Tax Service for registration in the Unified Registry.
In this case, the taxpayer – seller – is still obliged to determine the tax liabilities on the basis of such tax invoice. In order to prove the rights for the tax credit, the buyer needs to add the application and the complaint against the taxpayer – seller – to the tax return in accordance with para. 201.10 of the Tax Code.
Submission of the application and the complaint certainly requires extra efforts and the necessity to provide primary documents. However, this is better than the reduction of the tax credit on the basis of false data on the Customs Cargo Declaration.
In addition, the aforementioned approach on executing the tax invoice may be applied as a demonstration of disagreement of the taxpayers with the introduction of additional burdensome requirements that are obviously difficult to perform. If the vast majority of the taxpayers will use this way and will show sympathetic understanding to its users, then eventually the system will not survive and they will have to give up setting such requirements to the tax invoice that are impossible to fulfill. If it is done by all or by the vast majority, the tax authorities will not be able to verify everyone against whom the complaints were submitted. And even if they can, there is no use of that, since the tax liabilities were declared and paid to the budget.
The above commentary presents the general statement for information purposes only and as such may not be practically used in specific cases without professional advice.
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