Over UAH 2 mn. fines for a leading producer of sauces rescinded

Tax VAT invoice suspension Dnipropetrovs'k region

Complainee: State Tax Service of Ukraine (STS), Office of Large Taxpayers of STS (OLT)
Complaint in brief: The Business Ombudsman Council received a complaint from a leading Ukrainian producer of sauces and margarine. The complainant disagreed with the decision of the tax authority to impose a fine on the complainant due to the late registration of its VAT invoices. According to the company, it could not register tax documents on time because of the seizure of the company`s account in the VAT electronic administration system. Once the court lifted the seizure, the company sent all the pending VAT invoices for registration. At that moment the number of stuck VAT invoices was close to 3,5 k of files.
However, following the tax audit results, the OLT imposed on the company a fine in the amount of more than UAH 2 mn. Disagreeing with such a decision, the company immediately appealed to the Council. 
Actions taken: Having examined the complaint, the Council supported the position of the complainant. The Council recommended in writing to ensure comprehensive and impartial consideration of the case. The investigator ascertained that the late registration of the VAT invoices was not the fault of the company. Furthermore, the company did not avoid its tax duty and registered all the VAT invoices at its earliest opportunity. 
The investigator participated in the case consideration. In the view of the quarantine restrictions, the discussion of the case files took place in the format of the trilateral audio conference. 
Results achieved: the STS upheld the arguments of both the complainant and the Council, and satisfied the company`s complaint. By such a decision the STS has demonstrated its consistency while consideration of the similar complaints. Additional payments worth over UAH 2 mn. were dropped.

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