One of the changes provided in the Tax Code for 2023 is associated with a decrease in tax expenses of credit institutions that are in the process of liquidation. Thus, according to the court decision that has entered into legal force, it is provided that credit organizations declared bankrupt will be exempted from property and land taxes, the interest on tax debts will be suspended, and their property related to tax debts will not be registered. At the same time, the period for VAT exemption upon presentation of non-performing (toxic) assets as part of the reorganization and rehabilitation of insolvent banks, as well as upon presentation of bank assets as part of the bankruptcy procedure, is extended until January 1, 2026.
As it is known, according to the requirements of the Tax Code, in case of non-payment of taxes on time, interest is calculated for each past day after the payment deadline to the taxpayer, as well as, if the taxpayer fails to fulfill his tax obligations within the specified period, his property is credited as a way to ensure the payment of tax debts.
However, the Tax Code does not include any to suspend the payment of taxes or suspend the accrual of interest when an enterprise is in the process of liquidation. In this regard, in order to simplify the administration of the fulfillment of tax obligations of credit institutions that are in the process of liquidation, the Tax Code includes provisions regarding the suspension of interest accrual on overdue tax obligations of credit institutions that have been declared bankrupt by a court decision that has entered into legal force and is not included in list of their property. At the same time given that the calculation of property and land tax in the process of bankruptcy of a credit institution is economically inefficient, credit institutions were exempted from paying property and land tax from the month (year) of the adoption of the court decision on recognition of bankruptcy entered into force.
In addition, taking into account the measures taken to reorganize and improve insolvent banks, the period for exempting the provision of non-performing (toxic) assets from VAT under these measures has been extended for another 4 years.
