Ukrainian law enforcement pressuring entrepreneurs who participated in capital amnesty

Ukrainians who participated in capital amnesty by declaring their assets and paying taxes at reduced rates have encountered an unexpected setback. They’re increasingly under the scrutiny of the Bureau of Economic Security, facing inquiries into the legitimacy of funds that were recently deemed legal. Law enforcement is conducting searches and scrutinizing these individuals.

Throughout the amnesty campaign, authorities assured those who disclosed their funds and paid taxes at a reduced rate would have peaceful lives. Yet, the opposite seems to be happening. People who trusted the state and opted for a lawful path are now the focus of attention. Meanwhile, those who didn’t disclose their assets or pay taxes aren’t facing any issues yet.

Legal experts had anticipated such an outcome when the law on legalizing funds was introduced. The law doesn’t provide any assurances to those who underwent the amnesty process. Moreover, their actions practically acknowledge years of tax evasion. By disclosing all their assets and funds, authorities now have leads to follow. The capital amnesty initiative in Ukraine ran from September 1, 2021, to March 1, 2023. President Volodymyr Zelensky had hailed it as a “unique opportunity” for citizens to legalize their assets by declaring them and paying taxes at preferential rates to secure peace of mind.

However, the campaign didn’t yield the expected results. As of March 1, 2023, 845 declarations were filed, totaling 8.82 billion hryvnias in assets, with a declared fee of 547.5 million hryvnias. What transpired during the amnesty campaign? Essentially, participants not only disclosed their property, which they might not have found otherwise, but also admitted to evading taxes for years. The amnesty law promises exemption from fines and penalties for past unpaid taxes. However, authorities might question the legality of the funds’ origins, leading to investigations, document seizures, and involvement of others in the inquiry. Those implicated could face Article 212 of the Criminal Code, which involves substantial fines and even asset confiscation.