12.11.2019
Taxes and entrepreneurship: assessments and expectations
- According to the results of a survey conducted by Rating Group, 38% of respondents said they would like to start their own business. 10% stated that they already own a business. At the same time, half of respondents expressed no desire to engage in entrepreneurship. The highest demand for starting one’s own business is observed among men, the youngest and more affluent respondents, as well as those employed in the private sector.
- Among recent government initiatives aimed at regulating business, the most supported is the adoption of legislation to combat schemes used by large businesses to move money abroad and evade taxes (74%). About two thirds support the introduction of cashback (refunds to consumers if a seller does not issue a fiscal receipt), as well as the creation of an app similar to Privat24 or Monobank that would allow paying all taxes via smartphone. More than half support initiatives to expand the use of cash registers (RRO/PPO), introduce large fines for selling goods without a receipt, and allow receiving an electronic receipt instead of a paper one. About 40% support the abolition of the tax police and creation of a Bureau of Financial Investigations, the introduction of one-time asset declaration (at a 9–10% rate) for undeclared assets and funds, and the introduction of a separate tax for entrepreneurs in the IT sector. At the same time, among those who run a business or want to start one, initiatives such as cashback, fines for not issuing receipts, and expanding the use of cash registers are more often opposed than supported.
- Half of respondents believe that expanding the use of cash registers (RRO/PPO) is primarily about bringing order to tax compliance. Meanwhile, 38% view this step as pressure on small businesses. This latter view is strongly supported among those who already own a business.
- 79% believe that taxes contribute to Ukraine’s development. 74% are convinced that strengthening tax compliance control will improve Ukraine’s economic situation. 68% believe that timely tax payment ensures a decent pension in the future, and the same share support the statement that strict criminal liability should be introduced for tax evasion. At the same time, at least two thirds believe that tax levels in Ukraine are very high. This view is most strongly supported by business owners. Among this group, there is the lowest support for introducing strict criminal liability for tax evasion and for the claim that timely tax payment guarantees a decent future pension.
- 47% believe that the main share of taxes should primarily be directed to the social sphere (healthcare, education, pensions, subsidies). 39% believe that taxes should primarily be used to reform and develop the economy and build new infrastructure.
- More than 70% are convinced that taxes should be increased for oligarchs and large businesses. In contrast, opinions regarding sole proprietors (FOPs), small businesses, and employees are the opposite: more than 70% favor keeping taxes unchanged or reducing them for these groups. Regarding medium-sized businesses, opinions are split: 25% support tax increases, 30% support tax reductions, and about the same share favor no changes. Entrepreneurs and those who want to start a business tend to support tax reductions for all business categories, except oligarchs.
- 85% support strengthening liability for tax evasion for oligarchs and large businesses. 58% support this initiative for medium-sized businesses. For small businesses, opinions are divided: about 40% support stricter penalties, while about the same share oppose them. Opposition is higher among those who own a business.
- 60% have encountered situations where a seller did not issue any receipt for purchased goods or services (29% often, 31% occasionally), while 38% have not encountered this. Such situations are more common among young people and business owners.
- Only 13% reported receiving “envelope wages” (undeclared cash payments) over the past year; 85% did not have such experience. Reports of envelope wages are more common among young and middle-aged respondents, those seeking to start a business, and those employed in the private sector (in the latter group, 31%).
- Half of respondents know the amount of taxes they pay monthly on their salary/income; nearly 30% do not know; one in five said they do not receive salary/income. Awareness is higher among younger and middle-aged, higher-income respondents, entrepreneurs, and those seeking to start a business.
- Among state institutions, respondents trust the Army and the President the most (over 60%). Trust is also relatively high in the Government (42%), Verkhovna Rada (41%), and Security Service of Ukraine (SBU) (37%). Distrust prevails toward most other institutions: Police (trust 32%, distrust 53%), National Bank of Ukraine (28% / 45%), State Customs Service (21% / 55%), State Tax Service (21% / 52%), Ministry of Finance (18% / 52%). The lowest trust is in the courts (15% trust, 66% distrust) and the prosecutor’s office (14% / 70%).
- Army reform is evaluated relatively better: 31% rate it positively, 23% neutrally, 23% say they know nothing about it, and 14% negatively. Police reform is also rated relatively better: 18% positive, 25% neutral, one third negative. The most negative evaluations are given to judicial and prosecutorial reforms (32–35% negative, 21% neutral, 9–10% positive, and about a quarter know nothing about them). Awareness of reforms in the SBU, customs, and tax services is lower—about 30% know nothing about changes in these institutions; 10–13% rate them positively, 21–22% neutrally, and 24–25% negatively.
Methodology
- Audience: residents of Ukraine aged 18 and older. The sample is representative in terms of age, gender, region, and settlement type.
- Total sample: 2000 respondents.
- Personal formalized interview (face-to-face).
- The margin of error does not exceed 2.2%.
- Fieldwork dates: 22-30 October, 2019.
.webp)
