Honigma LLC, a small enterprise from the Lviv region, specializes in honey processing and primarily exports its products to Canada. The company had obtained all the necessary documentation confirming the legality of its operations and the quality of its products, including certification for future exports to the EU. However, it encountered an unexpected obstacle: it was added to the list of risky taxpayers. As a result, the company was forced to halt the export of a container of honey, putting a major international contract and the business itself at risk.
Despite multiple appeals to the tax authority, accompanied by a complete set of supporting documents and detailed explanations, the company kept receiving rejections. Moreover, the requirements for the documentation package kept changing, making it significantly more difficult for the company to defend itself effectively.
That’s when the business turned to the Business Ombudsman Council for help. The Council initiated persistent communication with the tax authority. In particular, it organized a discussion of the case within the framework of the Expert Group, which enabled a constructive dialogue between the company and the tax authority.
During joint efforts, it was revealed that the tax authority had concerns regarding the correlation between the volumes of honey purchased and sold. At the tax authority’s initiative, a mini-audit and a quantitative reconciliation of goods were conducted together with the company. The audit confirmed that the declared volumes of raw materials and finished products were accurate. The reason the risk assessment algorithm was triggered was due to an incorrectly filled classifier of goods in one tax invoice for honey processing services.
After the final set of documents was agreed upon and submitted, the tax authority confirmed that the company did not meet the criteria for being classified as risky. Consequently, the company was removed from the list of risky taxpayers, the Council successfully closed the case, and Honigma LLC’s container of honey was shipped to Canada.
