Dear Readers,

The Ministry of Finance posted a draft order for the implementation of the Pilot Project on the Demonstration of Taxpayer Due Tax Vigilance on the Open Legislative Acts portal. The document will be open for public discussion until 5 February 2024.

The Pilot Project defines due tax vigilance as a buyer’s execution of actions to collect and verify information about a supplier through the Business Partners Registry Information System (hereinafter - the BPR IS).

The goal of the Pilot Project is to test the BPR IS in administration of the demonstration of the due tax vigilance. The BPR IS is hosted on the website and integrated with the information systems of the authorized state organizations.

Procedure for Implementing the Pilot Project

Participation of taxpayers in the Pilot Project is voluntary. To demonstrate the due tax vigilance, a taxpayer:

  1. Registers in the BPR IS to check the reliability and integrity of a supplier;
  2. Receives a report on demonstrated due tax vigilance by requesting it from the BPR IS within ten business days before the transaction date. For long-term transactions – quarterly before signing the completion of work document. For tender procedures – within ten business days before the tender results are announced;
  3. Ensures the storage of the due tax vigilance report for the statute of limitation established by the Tax Code.

Due tax vigilance is considered demonstrated if a taxpayer receives a report on the demonstrated due tax vigilance containing information about the supplier being in the "green" or "red" zones. The taxpayer submits the report to the state revenue authorities, detailing demonstrated tax vigilance and information about third-party involvement by the supplier in the supply of goods, works or services.

The tax authorities will not file lawsuits to cancel transactions with suppliers in the "green" zone, but they can still apply other tax control measures.

It is planned that the Pilot Project will be realized from its first official publication until 31 December 2024.