OREANDA-NEWS. March 25, 2011. Simplified taxation system should not be used as a kind of tax evasion. The Vice-Chairman of the State Tax Service of Ukraine Oleksandr Klimenko stressed this during the press conference.

According to him, increase in business activity in the country is now marked. "The number of individual entrepreneurs - he said – as of January 1, 2010, totalled 2.65 million persons, as of January 1, 2011 - 2.7 million".

Alexander Klimenko said thus, that today one million 100 thousand individuals - entrepreneurs who are working on a simplified system of taxation are officially registered in Ukraine. 700 thousand of these have never had any relationship with entities - businesses and other entities of the real economy sector.

"They are not affected by changes introduced by the Tax Code starting April 1, 2011", he said.

At the same time 170 thousand out of the 400 thousand entrepreneurs who had such relations, worked in the same business, and were provided various services - accounting, auditing, consulting and more.

This is a typical scheme of tax evasion, Oleksandr Klimenko said, what retained nearly one billion UAH taxes on personal income and 2 billion for single social tax to come to the budget.

These entrepreneurs are likely to cease their activities and remain employees that they actually were, Oleksandr Klimenko said.

Concerning 230 thousand of other entrepreneurs, they have to decide on which tax system they would work better, the tax collector said. He said, "we are not talking about closing their business, but the choice of tax system" and for this tax service provides a variety of consulting services at the local level.

This work will continue until all the issues would be solved. Small and medium businesses operating fairly and openly in the legislative field, would not suffer from the innovations introduced by the tax code, Oleksandr Klimenko said.

He also said that January - February this year local budgets income tax revenues made less than 2 percent - 161 million UAH out of 8.1 billion UAH.