The aviation industry called on the Cabinet of Ministers to protect carriers from pressure due to the new interpretation of leasing - UATA
Kyiv • UNN
The Ukrainian Air Transport Association urges the government to form a unified position on the taxation of operating leases of aircraft. The Bureau of Economic Security has opened criminal cases against five airlines due to the interpretation of lease payments as royalties.
Representatives of the aviation industry have called on the Government to form a unified state position on the taxation of operational leasing of aircraft. After all, the current approach of the controlling bodies creates risks for the preservation of Ukrainian civil aviation. This was reported by the Ukrainian Air Transport Association (UATA), writes UNN.
Details
This problem goes far beyond a single dispute over the interpretation of lease payments for aircraft. It calls into question the ability of Ukrainian civil aviation to preserve carriers, crews, and operational capacity until the end of the war and the opening of the airspace. Without a clear position of the Government on preventing unlawful administrative and financial pressure on domestic airlines, which continue commercial activities abroad under the closed airspace, Ukraine risks meeting the restoration of air traffic without a sufficient number of its own airlines capable of quickly returning to work
UATA emphasized that operational leasing is a standard international practice used by the vast majority of airlines worldwide, and Ukrainian carriers have made such payments for many years in accordance with the Tax Code and international conventions on the avoidance of double taxation.
At the same time, according to the association, in 2024-2025, without any changes to the legislation, the controlling bodies began to apply a new approach to the tax qualification of such payments. This, as the association claims, has already led to retrospective additional assessments, administrative pressure, and the opening of criminal proceedings against individual airlines and their officials.
UATA is convinced that tax disputes should be resolved in the legal, administrative, and judicial spheres - without disproportionate pressure on business and without criminalizing issues of interpretation of tax norms
Representatives of the aviation industry and experts during the discussion of the problem emphasized that an aircraft is a means of transport, not an object of intellectual or industrial property. Therefore, the payment for its use under an operational lease agreement is a payment for the use of property, not royalties for the use of intellectual property objects.
Despite the fact that no violations were found during inspections of other air carriers, the Bureau of Economic Security has already opened a number of criminal proceedings. In particular, the BES is investigating cases against at least 5 airlines, including UIA, "Constanta Airlines", "Urga", N3Operations, and "Skyline" for the alleged non-payment of an additional 15% tax on non-resident income to the Ukrainian budget under aircraft and helicopter leasing agreements. Investigators equate lease payments to royalties and interpret aircraft not as vehicles but as "equipment".
The BES received analytical conclusions after the previous team of the State Tax Service published an article in 2024 in which it proposed to tax leasing operations with transport from non-residents of Ukraine as royalties. The documents formed the basis of criminal cases against airlines.
However, according to lawyers interviewed by UNN, during the investigation, investigators ignore the current international conventions on the avoidance of double taxation. The agreements ratified by the Verkhovna Rada with foreign states have priority over national legislation and determine in which state and at what rate the corresponding income of a non-resident can be taxed. Therefore, the automatic additional assessment of 15% in Ukraine without taking into account the provisions of a specific convention is at least controversial, experts emphasize.
It is worth noting that Ukrainian tax legislation regarding the taxation of leasing has not changed for decades. Moreover, according to the State Tax Service, airlines have passed tax audits, and only based on the results of one of them was a violation established during the taxation of leasing. The rest of the tax audits did not reveal such violations.
As a result of one audit of companies in the aviation industry, lease payments were reclassified as royalties. Just one audit
However, the absence of violations did not prevent the Bureau of Economic Security (BEB) from opening criminal cases against airlines, believing that they had not paid 15% royalties over the past 7 years. At the same time, the list of airlines against which law enforcement has claims regarding leasing may expand at any moment, since about 40 air carriers use leasing. Thus, the entire civil aviation industry could be under threat.