Business calls on Finance Ministry, Ministry of Development, Verkhovna Rada committees to exempt railway sites from land tax
The European Business Association has appealed to the Ministry of Communities and Territories Development of Ukraine, the Ministry of Finance of Ukraine and relevant parliamentary committees with an initiative to exempt from land tax the land of railway transport located within the right-of-way under the railway track and its arrangement.
According to the press service of the association on Wednesday, after the abolition of the tax benefit in 2019, JSC Ukrzaliznytsia pays billions of hryvnias in land tax every year. In 2020-2023 alone, this amount exceeded UAH 13.2 billion.
According to the association's experts, such a tax burden is economically unjustified and leads to a number of negative consequences for the railway (reduction of the competitiveness and investment attractiveness of the industry, underestimation of the profitability of rail transport, etc.). This especially affects the cost of rail transportation, which is directly reflected in the cost of logistics for business.
As noted by the EBA, in many EU countries, in particular, in Germany, France, the United Kingdom, Poland, etc., land tax for railway enterprises is not applied at all. After all, rail transport performs an important socio-economic function for local communities, providing interregional connections and creating jobs.
"Instead, in Ukraine, the railway is forced to cover the costs of land tax by increasing freight tariffs for business. So, it is business that actually compensates for Ukrzaliznytsia's tax obligations, and also losses from passenger transportation, which in 2024 exceeded UAH 18 billion," the organization emphasizes.
The EBA added that the Ministry of Development supported the position of the business community and confirmed the existence of unequal conditions in the transport sector.