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In Ukraine, IT Freelancing Under Threat

Posted by kdawson on from the intended-consequences dept.

An anonymous reader writes "According to the new tax law (Google translation; Russian original) that is being developed now and should take effect on January 1, 2011, it will not be possible for a private Ukrainian entrepreneur to provide any services to foreign companies without becoming a full-fledged company with a dedicated bookkeeper. Currently it is possible to perform such services and pay the equivalent of $25 in tax. Instead of raising the tax (which is overall welcomed by the community), the legislators plan to outlaw ISP, e-commerce, and Internet-based services — along with any services provided to foreign entities — for individual entrepreneurs. So starting in 2011, freelancers in Ukraine will have several choices: stop doing freelance work, start working illegally, become a full-fledged company subject to multiple cumbersome rules for taxation, or leave the country."

7 of 359 comments (clear)

  1. So? by kikito · · Score: 5, Insightful

    They will work illegally. No big deal. That's what any intelligent citizen of any country does when their lawmaking weasels start cranking stupid laws like that.

  2. Re:Sigh... by mobby_6kl · · Score: 4, Insightful

    Also as a Ukrainian (at least, Ukrainian born), I'm proud of the choice most would choose when faced with an oppressive, corrupt government.

  3. Re:"Professor killing Ukraine by shutdown+-p+now · · Score: 4, Insightful

    Well, he got elected fair and square after 6 years of rule by the pro-Western faction, so I guess people hated them more...

  4. Re:Let me get this straight... by dunkelfalke · · Score: 4, Insightful

    The deal is the widespread tax evasion in Ukraine. Not widespread as "German federal states are buying the Swiss bank account CD and expect a rise of self reports" but as in "Taxes? Somebody actually pays taxes in this country?"

    --
    "It's such a fine line between stupid and clever" -- David St. Hubbins, Spinal Tap
  5. Re:Let me get this straight... by ultranova · · Score: 5, Insightful

    Most of EU still has not realized that high taxes kill entrepreneurship, and thus kill the economy. lowering taxes grows the economy and thus increases the tax base -- but having a sizeable tax base is not nearly as important as having a sizeable economy, so better to err on the side of caution and cut taxes and entitlements where possible.

    Oh yes, the Reagan theory of economy. I wonder how many more countries will go bankrupt before they realize that it doesn't work, and that they are not an exception?

    But hey, the financial elite of those countries can get themselves a bit more money at the expense of everyone else, so it's okay, right?

    --

    Forget magic. Any technology distinguishable from divine power is insufficiently advanced.

  6. Re:Leave the country. by FuckingNickName · · Score: 4, Insightful

    Shhhh. The former Soviet states are now shining examples of capitalism. Pointing out that internal passports are still required (and that pro-Western governments are so hated that governments which implements these sorts of laws are voted in democratically) ruins the dream.

  7. Re:Let me get this straight... by orzetto · · Score: 4, Insightful

    The Finanzamt is essentially a bloated beast, 4 times the size of the IRS with respect to population.

    The comparison is unfair. According to Wikipedia (which we know is inerrant) 95% of taxes in Germany are to the federation; German states collect much less taxation than US states, and their taxation rights are limited. In particular, the German VAT goes to the federation, whereas sales tax in the US go to the states or other local authorities (IIRC).

    A fair comparison would be summing up all the federal and state Finanzämter and comparing with the sum of the IRS and local tax authorities in the US.

    --
    Victims of 9/11: <3000. Traffic in the US: >30,000/y