During the Verkhovna Rada Committee on Agrarian and Land Policy session, the UAC Deputy Chairman Mykhailo Sokolov pointed out the disproportionate amount of fines in the situations connected with fuel storage violations (in the case when fuel is stored by agricultural producers for their own needs).

The amount of fines starts from UAH 250,000 and formally, farmers fall under several points for which they can be fined.

Therefore, the penalty for storage of fuel for own needs without obtaining license is UAH 500,000. However, due to various reasons, by March 1, 2020 (the deadline for obtaining licenses) not all farmers were able to issue them. However, if the tax authorities on primary documents see that from March 1, 2020 the farmer bought fuel, and the storage license was absent this situation is interpreted as storage of fuel without a license, regardless the farmer has a license at the time of inspection or not.

In addition, farmers who have several legal entities and carry out centralized procurement and storage of fuel, in fact, refuel the equipment of different legal entities. And this can be considered by the State Tax Service as the sale of fuel in the possession of a license only for storage for own consumption. Because of that, the farmer can also be fined UAH 250,000-500,000.

A fine of UAH 1 million is envisaged for fuel production without licenses (fine for non-registration of excise duty) and a large number of agricultural producers are formally under the features of fuel producers, because they mix it - store in one basin a few types of fuel (which was bought from different suppliers). Such a fuel has different functions and speciation. That is why the State Tax Service recognizes such farmers, who store fuel exclusively for their own consumption, fuel producers and, as a result, fines.

"We have to understand that people are fined just for a formal violation, not for a real crime. Tax evasion is controlled and detected through tax invoices. And this is another test. We do not want to have the situation when those who steal and evade taxes have less fines than those who try to do everything right, but do some mistakes. There must be a compatibility of the fine to the economic activity conducted by the business entity. After all, it is extremely wrong when a farmer is fined more than the total amount of fuel that was bought during a year. And we have one fine for oil depots with a total fuel storage of 10 thousand cubic meters and for a farmer who stores 50 cubic meters. And this is extremely wrong," Mykhailo Sokolov mentioned.

During the committee session, the deputies agreed that it is important to find a solution as soon as possible, and in the future to adopt a law that will eliminate these conflicts.

It will be recalled that to simplify fuel accounting in the agricultural sector, experts from the analysis center “Smart Country” have developed a bill amending the Law of Ukraine “On State Regulation of Production and Circulation of Ethanol, Cognac and Fruit Alcohol, Alcoholic Beverages, Tobacco Products, Liquids, used in electronic cigarettes and fuel."