Tax Code: pay for the land will have even a beggar

24.11.2010 12:31
Articles about real estate | Tax Code: pay for the land will have even a beggar The Tax Code has not yet ventured to sign any speaker of the Verkhovna Rada, Volodymyr Lytvyn, neither President Viktor Yanukovych. But the document has already provoked the Ukrainians in street protests, therefore, most likely, it will be returned for revision to the parliament.

The greatest outrage code caused the small entrepreneurs uproschentsev, and the issue of taxation of land given less attention. And in vain, for paying tax at the new rates will have even the poor, writes

Tax in figures
According to the Verkhovna Rada adopted the Tax Code, the basis of land taxation is normative monetary valuation of land and area of plots, estimation of which has not been paid. In the first case the rate will be determined as a percentage of the appraised value (1% with the use of different factors - from 0,1 to 7,5) in the second - according to the table. It is worth noting that the initial rate for the invaluable land were lower, but the Verkhovna Rada on November 18 increased their three-fold.

Total is now over 1 square. m Ukrainians who owns the land without assessment, will have to pay 24 kopecks. up to USD 10.08. per year. Code also requires the tax exemption of land for construction and maintenance of residential homes, commercial buildings and structures: in the villages - no more than 0,25 hectares, in villages - no more than 0,15 hectares, in the cities - 0,1 hectares. It seems that this approach is quite loyal, but simple calculations show the opposite. For example, residents of large cities, who owns two sites, one of which stands the house, and on other cultivated potatoes have to pay for the second (assuming its size - only 10 hectare) 100 80 hrn. per year, and his grandmother in a remote village - 240 UAH. per year.

However, as the director of the Center for "Land Reform Policy in Ukraine" Maxim Fedorchenko, not even in the amount of work, and in the methods of calculation. And he was more concerned not so much a tax on land without assessment, but on sites that had to estimate, such as in Ukraine, the majority, and their number is constantly growing. "It is much more painful to the market and landlords beat the rate hike on land to the normative evaluation, which besides that is over zastarevshey technology, yet always indexed because of the progressive inflation.

Assessment Act provides that land value is revised every 5-7 years, but it is not often enough. For example, in countries where established full normal inventory, and the whole system is computerized, the process occurs automatically every year. And when an economic boom or recession, the tax base is sufficiently sensitive to these changes "- he explains.

In our case substantially delayed: booming economy ground was rated lower than market prices and the budget does not receive taxes. During the crisis, as economic activity fell sharply reduced profitability of business, and the tax rate is taken from the value that was calculated earlier on the rise in prices. "We have the same massive taxpayer - the Pauper" - outraged the expert.

As a workaround, M. Fedorchenko proposes the introduction of new, more innovative and flexible assessment of land, which today are used for the West.

No surprise
However, in general, the proposed rules of the Tax Code does not cause market participants are neither surprise nor much disturbance. As recalled by M. Fedorchenko, before payment for the land every year the budget law each year increased three-fold. Thus, according to his calculations, the total annual income from the land grew from 70 mln. up to 3 bln.

Senior lawyer Vasil Kisil & Partners Natalia Dotsenko-Belous concept of administration of land tax is called a systemic phenomenon and balanced. "On the one hand, retained the tax exemption on the ground for individuals who privatized land in the amount of the norms established for free privatization.

On the other hand, a manifold increase in tax rates for the use of valuable land (arable land), land, nature preserves, historical and cultural value not by the primary use, such as for construction ", - she said. In her opinion, the introduced approach is differential rates of land tax will be able to prevent the chaotic development of land carried out contrary to their intended purpose.

After all, before the crisis, many Ukrainians were buying up land as a "capital investment", hoping to cash in on their resale, and not by reference to their economic activities. Incidentally, the Code provides that to the farmland, which is not under investigation for over three years, used the coefficient of 1.2, as if the earth and beyond continues to be idle rate is increasing annually by 20%

Therefore, according to association president, "Land Union of Ukraine Andriy Koshil, the tax increase will make the holders of large amounts of land likely to expose them for sale to get rid of them. The price, in his opinion, would tend to decrease.

However, the release to market parts and reducing their cost does not mean that the market picks up, and the number of transactions increase. Experts say the market is too inert, and buyers are willing and able to invest in the purchase of extra land, too small to refract the situation.
Content tags: land Legislation
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