Draft bill #9243 of April 26, 2023
Cosponsors: a group of MPs from different factions and groups with Danylo Hetmantsev, the head of the Parliamentary Committee on Finance, Taxation, and Customs Policy, as the first signatory
Who is affected: the Cabinet, the State Tax Service, taxpayers, and businesses
Summary of the bill:
- the Head of the State Tax Service will be appointed by the Cabinet based on the results of a competition. The selection committee will consist of 9 people, 5 of whom will be proposed by international donors. The committee will nominate only one candidate to the Cabinet — the winner of the competition, and the Government will have to appoint that person
- the following will be required from the candidates for the Head of the State Tax Service: higher education in law or economics, fluency in the state language, high business and moral qualities, and work experience of at least 10 years, 5 of which — at management positions in government bodies, enterprises, establishments, or organizations
- the Head of the State Tax Service will be appointed for a 5-years term under a civil service contract. Key performance indicators will be defined in the contract. To dismiss or annul a decision appointing the Head will be possible only based on the grounds specified by law
- the Cabinet will appoint deputies of the Head without competition but based on substantiated submissions by the Head. Deputies of the Head will be dismissed by the Cabinet at the request from the Prime Minister initiated by the Head
- the State Tax Service will undergo an annual efficiency audit. It will be conducted by a commission of three people nominated by international donors
- the bill sets the remuneration for employees of the State Tax Service, including the Head (30 living salaries — over ₴77 thousand), department heads (28 living salaries — over ₴72 thousand), heads of territorial offices (20 living salaries — almost ₴52 thousand), etc.
- the Cabinet of Ministers will be obliged to conduct a one-time attestation of the Tax Service’s employees of categories B and C within three months after the appointment of the Head of the State Tax Service. Failure to pass the attestation will be a reason for dismissal from the position.
What is right:
- the bill provides foundations for the establishment of an apolitical and professional State Tax Service. If the proposed changes will be implemented successfully, the Service will work for the benefit of society, not politicians or the government
- the bill introduces a competitive selection and new requirements for the position of the Head of the State Tax Service.
What is wrong:
- the attestation procedure for the State Tax Service officials is not defined clearly enough. As a result, the relaunch of the Service could fail. The timing and specifics of the procedure of re-attestation for the National Police of Ukraine were the key reason why unqualified employees retained their positions
- the bill forces the Cabinet to appoint the only nominee proposed by the selection committee thus limiting the Cabinet’s authority. Moreover, it deprives the Cabinet of any political responsibility for the further actions of the Head of the State Tax Service since the Cabinet will have no choice in appointing the candidate
- the decisive influence of international organizations on the competition and audits of the State Tax Service undermines state sovereignty.
Alternative solution: to introduce a more detailed attestation procedure for the State Tax Service officials to prevent lawsuits and reinstatement of officials who will fail the attestation. Also, the balance of interests of the state and international donors should be reconsidered while adopting audit and competition procedures.
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