"Who else but them, if they are unique" - Nina Yuzhanina on the prospects of aviation enterprises' residency in Defence City

As part of the preparation for the second reading of the Defence City bills, people's deputies are discussing the conditions for including aviation enterprises that modernize and repair aircraft and helicopters for the Armed Forces of Ukraine among the residents of the special legal regime. This was reported by People's Deputy, member of the political party "European Solidarity" Nina Yuzhanina in an exclusive comment for UNN.

Details

In Ukraine, bills on Defence City – a special regime for supporting the defense industry – are being prepared for the second reading. The aviation industry risks not being included in the list of residents, despite the key role of aviation enterprises in modernizing equipment for the Armed Forces of Ukraine. In addition, since 2025, the industry has lost tax benefits that had been in effect for over 10 years, and warns of the threat of repeating the fate of the destroyed space industry. Aviation representatives emphasize that participation in Defence City could be an optimal way out of the crisis.

According to People's Deputy Nina Yuzhanina, the issue of including aviation enterprises in Defence City residents is regularly considered at meetings of working groups of the Verkhovna Rada Committee on Finance, Tax and Customs Policy. Various stakeholders participate in the discussions, and the critical importance of preserving aviation potential is beyond doubt. The inclusion of major aviation companies in the special regime is considered unconditionally necessary.

"It is obvious that those (aviation - ed.) enterprises should have a benefit. And who else but them, if they are unique," Nina Yuzhanina noted.

At the same time, discussions are currently underway regarding the conditions and criteria for selecting Defence City residents. In particular, one of the proposals provides that enterprises must receive at least 90% of their income from activities in the field of defense production and services that directly meet the needs of the security and defense sector. However, the flagships of aviation, including SE "Antonov" and JSC "Motor Sich", will not be able to fulfill them.

My proposal was as follows: for such a category of enterprises (aviation - ed.), the total volume should be 50+. That is, if even 50% of the total income from all types of activities consists of military products, military equipment, as written, then I would propose to grant them the same preferential conditions, provided that the remaining 50% of income will be taxed under the general taxation system

Nina Yuzhanina reported that all other proposed aviation changes and criteria will be considered at the next meeting of the Verkhovna Rada Committee on Finance, Tax and Customs Policy.

Recall

UNN obtained a list of amendments to one of the bills on the creation of Defence City, submitted by people's deputies for the second reading. It is proposed to expand the list of residents by including aircraft manufacturing enterprises that fall under the Law "On the Development of the Aircraft Manufacturing Industry". This will allow officially including aviation enterprises, defined by the Cabinet of Ministers as critically important for the economy and defense, in Defence City.

Regarding the income threshold from defense activities, it is proposed to reduce the requirement to 40-50%, take into account annual, not just quarterly income, and include in defense income the production and maintenance of aircraft, engines, and components. Without this, even giants like SE "Antonov" risk being left out of the special regime and losing tax benefits. It is also proposed to include in Defence City enterprises that participate in international contracts for the export of military or dual-use technologies.

In addition, it is about abolishing restrictions on the presence of tax debt, overdue contracts or dividend payments, as in wartime conditions this does not always indicate unreliability. Operations are affected by shelling, relocation, and supply disruptions. Instead, it is proposed to allow the inclusion of such enterprises in Defence City provided that the debt is repaid within three years.

Other amendments provide for the expansion of tax benefits for aircraft manufacturing (provided reinvestment), customs preferences for critically important imports, state guarantees and insurance of export contracts. The conditions for returning benefits in case of loss of compliance with the criteria are also clarified, including the prohibition of retrospective sanctions. The released funds should be directed to production development, modernization, research and development, implementation of new technologies, personnel training and acquisition of intellectual property rights in the field of aircraft manufacturing.