Parliament approached to cancellation the equity participation

Parliament approached to cancellation the equity participation

Today, without exaggeration, a historic event took place. The Verkhovna Rada in the first reading adopted a bill that abolishes the investment tax – a share in the development of the infrastructure of the settlement. Regardless of the method of calculation – through the coefficients or percentages of the estimated cost of construction – it is insanely corrupt and meaningless tool that finally has a chance to go into oblivion.

Today, developers are forced to pay twice: the first time – direct equity, the second time – to create the same infrastructure. In this case, the money raised, regardless of the amount, is simply dissolved in the general budget and does not go to infrastructure development. And if previously built infrastructure in the form of networks, roads, kindergartens and schools could be counted as a shareholding, now it is not working – either because of another “improvement” of legislation, or because of the reluctance of local authorities to take on the infrastructure.

The whole industry has been waiting for this day for more than a year, with about a dozen different bills registered in Parliament regulating unit participation in one form or another, but only today did we see real progress in this matter.

There are several settlements in Ukraine, which, without waiting for the law to be passed, have virtually nullified the unit participation at the local level, setting a rate of 0.01%, since they realized that its administration was more expensive than the contributions themselves. But this strategy needs to be extrapolated to the whole country.

As a prudent person, I am very pleased that this has finally happened and I am sure that very soon we will all have a positive impact on the pace of investment in any construction – after all, the unit participation was collected not only from residential complexes or shopping centers, but from any construction, except for industrial, government and similar projects. Therefore, we look forward to the adoption of this bill as soon as possible in the second reading.

Andriy Ryzhykov, CEO and Managing Partner of DC Evolution

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