OLX and Uklon Tax: Who will feel the impact of the fresh 10% duty on web-based transactions and what drives the disapproval? As summer drew to a close, the government endorsed legislation introducing levies on internet-based sales and offerings. The updated tax will be applicable to each exchange on virtual platforms.
RBC-Ukraine delves into those who will encounter the “OLX tax,” the sum they will be obliged to contribute, and the rationale behind the criticism.
The “OLX tax” is slated to be initiated via legislative proposal No. 14025 “Concerning Amendments to the Tax Code of Ukraine and the Law of Ukraine “Regarding Banks and Banking Operations,” pending a vote in the Verkhovna Rada.
Supposing the measure gains approval, commencing in 2026, earnings generated by Ukrainians from online sales or services will incur a 10% tax. The agenda incorporates affording tax agencies access to financial data and instituting bolstered oversight.
Despite the absence of a parliamentary vote thus far, compelling justifications exist to anticipate its enactment. This constitutes an expectation from both the European Union and the International Monetary Fund, formalized within the IMF’s memorandum. Moreover, the fiscal plan for 2026 already factors in proceeds of 14 billion hryvnias for this specific item.
The proposed law seeks to govern levies in a domain formerly considered a haven for digital enterprises, according to Yaroslav Zhalilo, Deputy Director at the National Institute for Strategic Studies.
“This legislation will primarily target business operators who routinely leverage digital platforms to lighten their tax liabilities,” he pointed out, also suggesting that the implementation of this taxation framework could lead to amplified costs for services and merchandise marketed on these avenues.
Digital platforms implicated by the bill might also escalate their service charges, as per Andriy Shabelnikov, leading figure of the Ukrainian National Bar Association's Committee on Investment and Privatization and managing partner at the EvrikaLaw legal practice.
Upon the enactment of amendments prescribed by Bill No. 14025, operators will face supplementary obligations to pinpoint accountable vendors on their platforms and present reports to the State Tax Service. “Without a doubt, fees associated with platform usage will rise,” the expert underscored.
Who will bear the brunt of the tax revisions?
The novel taxation will encompass citizens aged 18 and above engaging in the sale of items or the rendering of services through digital channels, spanning websites and mobile applications. The tax shall be pertinent to property and vehicle leases, merchandise sales, and service provisions.
Thus, the updated regulations will extend beyond sellers on OLX to include drivers affiliated with Uklon and Bolt, property owners listed on Airbnb and Booking.com, sellers featured on Amazon and Rozetka, participants on BlaBlaCar, and freelancers operating on Kabanchik and Upwork.
Simultaneously, levies will not pertain to intermediaries facilitating platform operations, such as those involved in payment management (Liqpay, WayForPay, Platon), advertisement placement, or software upkeep.
“The fresh prerequisites are pertinent to both Ukrainian nationals and non-nationals, and the tax agency will accumulate a wealth of data to scrutinize income declarations and avert tax avoidance,” emphasized Anastasia Rudenko, an attorney at the Winner Partners law firm.
What duties will you be compelled to remit?
Earnings channeled via digital avenues will be subjected to a duo of tax classifications: a 5% military levy and a personal income tax. The applicable rate will hinge on the presence of a specifically designated account.
Should such an account exist, the tax ratio will stand at 5%. Integrating the military levy, this culminates in 10% of earnings. Absent a dedicated account, the standard rate of 18% prevails, amplified by the 5% military levy, totaling 23%.
Tax remittance is obligatory for sales earnings from the preceding annum. In scenarios where the aggregate sales sum for the year remains below 12 subsistence wages (36,336 hryvnias), a tax reimbursement is obtainable. To initiate this, submission of a tax declaration to the Tax Service is requisite.
This condition was met with critique from Nina Yuzhanina, an affiliate of the Verkhovna Rada Committee on Finance, Taxation, and Customs Policy. She accentuated the improbability of numerous Ukrainians undertaking tax filings solely for this recompense.
“Will a substantial cohort of individuals engage in minor sales? Who would willingly 'endure the inconvenience' of lodging declarations and remitting taxes? The more modest the cumulative value of goods vended and the levy deducted, the greater the likelihood that an individual will abstain,” the MP articulated.
Inaugurating a segregated, earmarked account constitutes a pivotal stipulation for digital sales. It must exclusively accrue proceeds from the digital platform. The bank retains the prerogative to disclose transaction details pertaining to this account to the tax authorities.
“The imperative to establish a discrete bank account for each digital platform is nonexistent. One sole designated account catering to all such monetary dealings suffices,” Rudenko clarified.
An annual earnings threshold exists on the special account: 834 minimum salaries, presently approximated at 6.7 million hryvnias. Surpassing this sales amount entails a 10% levy on the 6.7 million hryvnias, with the remaining funds taxed at 23%.
Devoid of a special account, up to three sales annually, capped at €2,000 (roughly 97,000 hryvnias), are permissible. In this instance, the levy will be 10%, and customary bank accounts are applicable.
Individual business owners are similarly exempt from the necessity of a special account. The tax framework for them remains static, contingent upon platform notification of their status.
How to fulfill tax obligations
Remittance of taxes on earnings derived via digital avenues will occur monthly. The platforms will undertake the role of tax intermediaries, channeling taxes to the treasury, akin to the present practice of banks levying taxes on deposits.
“When engaging in commerce through digital platforms, the platform itself assumes the role of tax intermediary. Consequently, platform patrons are absolved from the necessity of filing supplementary tax declarations,” Shabelnikov elaborated.
The anticipation is for tax deduction on each disbursement to the seller, succeeded by its transmission to the state. Earnings will be subjected to taxation absent expense deductions. “This measure was implemented to streamline computations and unburden individuals from the onus of upholding accounting ledgers. Expressed differently, the system bears a strong resemblance to a sole proprietorship, albeit devoid of registration mandates,” Zhalilo underscored.
What individual particulars can the tax regulators procure?
The legislation advocates for digital platform administrators to forward seller-specific data to the Tax Service. This dossier encompasses the seller's surname, given name, and middle name, residential location, tax identification number, individual VAT number, and birthdate.
In the scenario of the seller leasing out property, the report will additionally encompass the property's address, the aggregate rental income for the reporting quarter, the tally of rental transactions, and any incurred fees, commissions, and collected taxes.
