Verkhovna Rada adopted the first reading of a bill on the support of the software industry

The Verkhovna Rada of Ukraine adopted the first reading of draft Law of Ukraine “On economic experiment to create favorable conditions for development on the industry of software products in Ukraine” No. 8267 introduced March 18, 2011. Passage of the bill was voted by 277 deputies. Legislative proposal aims on the development of conditions for the qualitative improvement of software industry competitiveness and the legalization of “shadow” market segment in Ukraine. To do this, from January 1, 2012 to January 1, 2017 an economic experiment will be conducted, which provides a special taxation regime for IT enterprises.

Following taxes and fees are affected:

    1. income tax (16%);
    2. single fee for compulsory social insurance (36.76% of the amount of two minimum wages multiplied by the number of salaried employees);
    3. single payment for employees (3.6% of the amount equal to two minimum wages);
    4. payroll tax for individuals (10%).
The draft law defines the criteria for involvement and participation in the experiment, as well as major planned activities and a mechanism to evaluate their effectiveness. One of the main initiators of this legislative initiative is the IT Ukraine Association, headed by Nikolay Royenko, president of Miratech. In 2011 Association’s representatives conducted a number of activities for public discussion on the bill No. 8267 with representatives from government, IT companies, academia, NGOs and the media. According to their results documents have been developed, which laid the foundation of revised bill presented by the authors on August 4, 2011. On December 14, 2011 parliamentary hearings were held on the creation of favorable conditions for development of the Information Technology industry in the country. Hearings were attended by 17 employees of Miratech. Nikolay Royenko in his speech at the Verkhovna Rada of Ukraine explained the importance of legislative support for the industry: “This is a unique chance to make Ukraine a well-known not only in the metallurgical industry, agriculture, but in such highly intellectual area as IT. And it does not require a huge investment, you need to send a signal to investors, and such a signal would be the adoption of relevant laws. This is absolutely feasible task.” He also noted that “in the long term we can achieve real development of the software industry and the amount of exports could exceed $10 billion.” Miratech welcomes the adoption of the draft Law “On economic experiment to create favorable conditions for development on the industry of software products in Ukraine” and expresses the hope that a constructive dialogue with industry representatives and state authorities will continue in the future. Source: Miratech