As is known, the “Procedure for Determining the Taxpayer's Ability to Pay Tax Debt” was approved by the relevant decision of the Cabinet of Ministers on September 3, 2024. These Procedures, aimed at economic stimulation, primarily establish a mechanism focused on improving taxpayers' financial standing and promoting competitive entrepreneurship.
In practice, some indebted taxpayers are unable to meet their tax obligations on time due to financial difficulties. In such cases, granting them a deferral for a certain period helps support their ability to fulfill their tax obligations. Specifically, tax legislation includes provisions that allow for the extension of debt payment periods within certain requirements, taking into account the taxpayer's current financial situation.
According to Article 85.6 of the Tax Code, specific circumstances warrant an extension of the debt repayment period, one of which is the taxpayer’s inability to pay the tax debt in a single payment. For this reason, when reviewing such requests, the tax authority must first accurately assess whether the debtor currently has the ability to pay.
For this reason, a unified mechanism needed to be established to ensure that only debtors facing genuine financial hardship could benefit from this provision of the law, while also preventing any potential abuse in this area. The corresponding decision of the Cabinet of Ministers will regulate this process.
