The UAC, together with other business associations that are members of the Coalition of the Ukrainian Business Council (UBC), called on the authorities to adopt a list of measures to preserve the full work of exporters, prevent the loss of significant budget revenues and restore VAT refunds.

Relevant appeals were sent to the Prime Minister of Ukraine, the Minister of Economy of Ukraine, and the heads of the relevant committees of the Verkhovna Rada of Ukraine, which includes proposition to hold a professional discussion with business representatives and jointly agree on further steps to ensure the functioning of the wartime economy.

"As a result of Russia's military aggression against Ukraine, the working conditions of business and the economy as a whole have changed significantly. Nowadays the transition to a wartime economy is critical, when a significant part of the state budget should be financed not by extorting taxes from entrepreneurs (which will lead to the closure of enterprises) but by external borrowing at low interest rates and financial assistance from international organizations. In particular, at the moment in Ukraine there is a situation when Ukrainian producers and exporters have been suspended VAT refunds. This will have an extremely negative impact on Ukrainian producers and will lead either to the use of perfectly legal schemes of atypical exports, which are already made by a number of exporters, or to the cessation of production. Winning 1-2 month period, collecting VAT from exporters and not refunding them - the state will lose much more in the period of 3-6 months, not receiving many times the amount," is mentioned in the statement.

Business associations propose to use other sources of additional revenues to finance the needs of the budget and the Armed Forces, especially temporary import duties on goods that are mass-produced in Ukraine. This, on the one hand, will protect domestic producers, and on the other - will provide additional revenues to the budget.

Nowadays, in the most difficult situation are enterprises, which have a share of exports of 50-100%, and the share of cost elements, which they purchase from VAT payers, in the amount of 50-90%. They are rapidly losing working capital, which makes it impossible to continue production in the coming months. First of all, these are enterprises in the field of metallurgy, mechanical engineering, food production, etc.

For example, significant losses of the state in the coming months are projected in the field of oil production. The current unreimbursed VAT on the industry is UAH4.2 billion; expected losses of all taxes and fees from the industry after its closure - UAH6.3 billion per month. Critical situation in the confectionery industry: the approximate losses of producers from non-refund of export VAT are UAH90 million per month. The confectionery industry estimates that due to non-refund of VAT, exports will be reduced by 60%, so the final loss will be: foreign exchange earnings - USD6.24 million per month (USD74.9 million per year); loss of jobs - 1,200 people.

Business suggests that the provision of VAT bonds could be considered as a temporary interim solution (domestic government bonds for VAT amounts) on a part of the unreimbursed VAT, provided that the other part is reimbursed. This will allow obtaining new loans secured by such bonds.

"It will be recalled that similar models were already used by the Government in 2010 and 2014," is mentioned in the statement.