During the period of active hostilities, the sky over Ukraine is closed to civil aviation. However, along with discussions about the need for negotiations to end the war, experts are also contemplating post-war economic recovery, particularly the support and development of industries that could become drivers of Ukraine's revival. One such area is aviation, which is currently under threat. Criminal proceedings against Ukrainian airlines due to the interpretation of lease payments as royalties could have far more significant consequences than individual tax disputes. After all, it is no longer just about paying taxes, but about who will remain to restore Ukrainian civil aviation after the war ends, writes UNN.
Airlines survive during the war
In Ukraine, there is a prevailing opinion that since flights for civil aviation are banned, the industry has ceased to exist. However, this is not the case. Most Ukrainian operators have managed to restructure their activities — they operate on international markets, fulfill contracts abroad, and at the same time maintain Ukrainian registration, personnel, and competencies. In addition, Ukrainian airlines carry out UN humanitarian missions and have pushed Russians out of this market.
Therefore, the industry has not only retained professional staff but also continues to fill the state budget. According to the State Tax Service, in 2025, aviation industry enterprises paid over UAH 702 million in taxes, which was the highest figure in the last eight years.
However, the financial indicators of the companies themselves indicate a different trend. Despite the growth in revenue of individual operators, most enterprises operate with minimal profitability or remain unprofitable altogether due to high costs for relocation, aircraft maintenance, insurance, and personnel retention.
Under such conditions, any additional fiscal burden or criminal prosecution is critical for the industry.
New interpretation of taxation creates risks for business
The civil aviation industry came under massive pressure after the State Tax Service and the Bureau of Economic Security began in 2024 to interpret the taxation of aircraft leasing transactions with non-residents of Ukraine as royalties.
Despite the fact that for decades such payments were made in accordance with the provisions of international conventions on the avoidance of double taxation, today law enforcement officers have begun to qualify them as payment for the use of intellectual property, which, according to the investigation, creates an obligation to pay an additional 15% tax.
At least 5 airlines have suffered from this approach to interpreting air transport leasing, including MAU, "Aviation Company Constanta", "Urga", N3Operations, and "Skyline". They are all being accused of having to pay an additional 15% royalty to the Ukrainian budget for the lease of aircraft and helicopters.
Representatives of the aviation industry point out that this interpretation of tax legislation by the BES creates an additional fiscal burden and reduces their competitiveness in the international market. Moreover, this approach contradicts international law and jeopardizes Ukraine's image as a reliable partner with predictable rules for business.
Thus, the problem extends far beyond specific cases. If this legal position becomes established practice, all Ukrainian carriers that use aircraft under international operating lease agreements will be at risk. And over time, the practice will spread to other industries that use leased transport, such as railway or agricultural machinery.
After the war, planes will not return on their own
After the opening of Ukrainian skies, the state will face a massive task — restoring regular air service and bringing domestic air carriers back to the market.
For this, it is not enough to simply open airports. Airlines, aircraft, crews, engineers, technical bases, training centers, and international contracts are needed. And most importantly, it is necessary to do everything possible to ensure that Ukrainian companies return to the market, because they will be able to ensure maximum budget revenues, and therefore contribute to the revival of the economy.
If a significant portion of Ukrainian operators lose the ability to work due to criminal prosecution by that time or are forced to change jurisdiction, the restoration of air transportation could drag on for years. The niche will quickly be filled by foreign companies, and opportunities will be effectively lost.
In this case, Ukraine risks losing not only hundreds of millions of hryvnias in tax revenues but also its own aviation sector as such. It is worth recalling that our country has one of the most powerful aircraft repair and aircraft construction potentials, and its development directly depends on the functioning of the civil passenger and cargo transportation industry.
Thus, the discussion around lease payments has already gone far beyond tax law. In fact, the question is being decided whether Ukraine can preserve its own air carriers until the end of the war. Each new criminal proceeding means not only risks for a specific company. It sends a signal to the entire market about the unpredictability of state policy and law enforcement.
And if today companies that continue to operate, pay taxes, and maintain Ukrainian teams even under closed skies are under threat, then after the onset of peace, a much more complex question may arise: who exactly will fly flights under the Ukrainian flag.