Аналитика. Статьи. Комментарии.
Опубликовано 01.07.2017 Николай Войтович
Members of Parliament proposed amendments to the Customs Code in terms of the duty free limit value for cross-border movement of goods. How should this initiative and particularly the rise in the duty free value, affect the conditions of doing business in Ukraine?
#07-08 July-August 2017
The Ukrainian Journal of Business Law
The discussion about altering the duty free limit for cross-border movement of goods is not new for Ukrainian society. At the end of 2016, the association that represented producers, importers, and distributors of electronic products initiated a big fall in the limit from EUR 150 to EUR 22. Considering that members of the association covered nearly 90% of the domestic electronic market, the initiative, which became a draft law, sparked huge debate and public outrage. As we may see now, the legislative pendulum has reversed, and MPs suggest the opposite move — to double the limit. Therefore, opinions from previous discussions are still topical and applicable.
Consumers who will get more options in the international market hail the initiative. If it becomes law, individuals will have access to a broader range of products that are of better quality and for a lower price; a number of orders from Ukraine in worldwide systems of on-line shops will blow up; fulfilment of such orders will cause a sufficient rise in the revenues of logistics companies. Amid the influx of imported goods, local retailers will feel tougher competition and will be forced to cut prices, clearly benefit consumers. Since more products will be legally available from abroad, the level of traffic in illegal goods will go down.
The new limit will definitely cut the amount of income the state budget receives from VAT and customs duty as the import of more items will be exempted from these charges. However, some analysts consider those losses may be compensated by payments from the increased turnover of imported goods on the domestic market.