The Government adopted a resolution improving the procedure for commission trade in vehicles
On October 1, the Cabinet of Ministers adopted a resolution that improves the procedure for commission-based vehicle trading, in particular, the mandatory submission of a document confirming the value of a vehicle to conclude a sale and purchase agreement.
As of today, the sale of two or more passenger cars per year is subject to a 5% income tax on the 2nd car, and 18% on the 3rd car per year or more. Sales of the first vehicle within a year are tax-free. The sale of the first truck is taxed at 5%, and the second and subsequent trucks at 18%.
When a person sells a passenger car (two or more) or a truck in the service centers of the Ministry of Internal Affairs of Ukraine, it is mandatory to provide a certificate of average cost or an expert assessment of the vehicle's value. Thus, taxes are paid in full.
"For example, if a person sells the second car of the year at a service center of the Ministry of Internal Affairs, with a certificate of average market value, it will be valued at UAH 450 thousand, and the 5% tax will be UAH 22.5 thousand. Instead, a trade organization assesses the value of a car not on the basis of an official document, but "according to the seller," for example, UAH 15 thousand, and pays a tax of UAH 750. Moreover, the cost of a premium car for UAH 15 thousand is not an allegory, but a reality. Unfortunately. For example, a 2022 Tesla Model 3 was recently registered for UAH 10,000. At the same time, the real average market value of such a car is UAH 917,083," explained Deputy Minister of Internal Affairs of Ukraine Bohdan Drapyaty.
The average market value can be easily checked on the website of the Ministry of Economy of Ukraine.
As of August 2024, there are 3.5 thousand entities engaged in wholesale and retail trade in vehicles in Ukraine. In 2023, 470 thousand cars were sold through trade organizations.
The implementation of the act is expected to increase revenues to the state budget of Ukraine and establish a fair approach to the conduct of business activities for the sale of vehicles.