In the Office of the President of Ukraine, there are plans to offer Ukrainians exemption from mobilization in exchange for coming out of the shadow economy and paying taxes

The Office of the President of Ukraine, the Cabinet of Ministers of Ukraine, and Ukrainian Members of Parliament are considering an update to the mobilization mechanism, which would involve reserving conscripts who pay taxes.

Forbes reported on this update to the mobilization mechanism following the submission of a bill on improving mobilization to the Verkhovna Rada (Ukrainian parliament).

Currently, reservation is available only for employees of enterprises with ‘critically important’ status.

Another criterion under consideration by the authorities is the volume of taxes paid on personal income from an official salary or income.

The existence of this idea in such a format, under anonymity, was confirmed by four Forbes interviewees from two factions in the Verkhovna Rada of Ukraine and a consultant from the Office of the President of Ukraine.

There isn’t a final concept or draft of the document outlining the new approach yet. Among the options considered was the adoption of new rules during the Cabinet of Ministers of Ukraine meeting on December 29, specifically amending Government Resolution No. 76, which establishes the approach to reservation. However, this approach was declined, and now the proposal will likely be considered by the Verkhovna Rada of Ukraine.

One of the sources revealed the figures discussed at the Ministry of Digital Transformation meeting on December 28.

According to this source, automatic reservation from mobilization would be granted if individuals pay a minimum specified amount of personal income tax per month – currently discussed at 6000 hryvnias per month, roughly equivalent to a salary of around 33,400 hryvnias (26,900 hryvnias net salary, as an employed worker also pays a 1.5% military fee). Additionally, the employer must contribute 22% of the salary as a single social contribution.

Another proposal mentioned is setting the official salary (wage) threshold at 35,000 hryvnias, which closely aligns with the first proposed figure. The third parameter is that an employee can be reserved if the employer pays around 14,500 hryvnias as a single social contribution (equivalent to a salary of 66,000 hryvnias). The principle may also be extended to individual entrepreneur criteria (clear criteria for this group are currently unknown).

For the special tax regime ‘Diia.City’ for the IT industry, the discussion involves a minimum salary threshold equivalent to 3200 dollars.

“The reservation is conducted through synchronization of state registries. This involves the ‘Obereg’ (registered conscripts) and tax payment information. If a conscript pays the required amount of personal income tax and has all the necessary documents in order, a QR code for the reservation will be generated in ‘Obereg.’ This QR code will be valid for 45 days,” the article states.

For this new system to function, a mobilization law needs to be enacted, registries need to be organized, and several legislative norms must be revised. Particularly, amendments to the Tax Code are required since currently, reporting for personal income tax is submitted to the Tax Service quarterly rather than monthly.