PwC: Ukrainian IT service market could double with annual increase of tax burden by no more than 1%
The Ukrainian IT service market by 2020 could expand to $5.7 billion from $2.7 billion in 2015 if the tax burden for the sector grows no more than 1% a year, according to a study of PricewaterhouseCoopers (PwC) conducted under order of the European Business Association (EBA) spread at the Lviv IT Arena Forum last week.
According to the study, the results could be achieved if the consequent IT taxation policy is conducted and innovative solutions are introduced in the rest of the Ukrainian economic sectors.
"If the optimistic sector development scenario is realized (taxes grow by 1% every year and inscentive measures are taken by the government) 146,000 specialists will work in the IT sector and some UAH 27 billion of taxes will be paid to the budget," PwC Ukraine Director for Business Consulting Olga Andrienko-Bentz told reporters.
According to PwC, the share of IT service exports of Ukraine's GDP could grow from 3.3% in 2015 to 4.5% in 2020.
She added that with the basic scenario (unchanged tax rate until 2020), the sector will pay around UAH 21 billion of taxes to the budget. The pessimistic scenario envisages the increase of taxes to 20%, and budget payments would reach UAH 13 billion by 2020, while the number of IT specialists would decrease to 72,000.