17:03 22.05.2019

Valerii Makovetskii: Why Foxtrot pays taxes fairly and teaches Ukrainians how to do so

12 min read
Valerii Makovetskii: Why Foxtrot pays taxes fairly and teaches Ukrainians how to do so

Valerii Makovetskyi and Gennadii Vykhodtsev are the Foxtrot Group of Companies’ top men. The brands they develop are well-known all over the country: Foxtrot, Secunda, the development project of DEPO’t Center shopping malls in oblast centers, etc. Currently the founders of the brands are not only working on their development but also developing a fair taxpayer brand by personal example.

  • Why Foxtrot is a fair taxpayer
  • Why Foxtrot concerns with educating conscious taxpayers
  • The task of educating conscious taxpayers
  • Valerii Makovetskyi tells about white taxes and their part in building the healthy business environment in Ukraine.

Today, many Ukrainians may react to the word “taxes” like a bull to a red rag (muleta) which matadors use. But in many cases, the people who talk about high taxes in Ukraine are tax evaders. Quite the opposite, fair taxpayers concern themselves with the country’s budgeting process.

Curiously, the interested audience on both sides of the fence are aware of the part of taxes in the country’s life. The money is spent to fund the army and police, schools and hospitals, pay pensions and other social benefits, finance sport, social and environmental events. By the way, in the Kingdom of Denmark only taxpayers are allowed to vote - it is of importance!

Why Foxtrot is a fair taxpayer

The state budget receives taxes from private persons, as VAT, excise taxes, as business income taxes, customs duties, rental payments, subsoil use taxes.

And here is the most important thing! In 2018, all the companies working under the Foxtrot brand that Gennadii Vykhodtsev and Valerii Makovetskyi develop paid taxes of UAH 664,029,927 to the state budget. In 2017, the Foxtrot chain transferred UAH 534,781,357 to the state budget. In 2016, the taxes paid amounted to UAH 374,346,950. The payments grew 30% from 2016 to 2017, and 22.6% from 2017 to 2018.

CASE Ukraine experts estimated that taxes paid to the state budget by the companies led by Chairman of the Supervisory Board Valerii Makovetskii would be enough for the following items:

  • UAH 664 million is enough to train 8 thousand students in higher educational institutions of III-IV levels of accreditation in Ukraine;
  • UAH 664 million is enough to pay 244 thousand presidential scholarships to gifted students for a year;
  • UAH 664 million is enough to purchase 300 new B-type equipped ambulances.

Most interesting facts about Foxtrot

  • Foxtrot is the biggest chain of electronics and household appliances outlets. The brand is Ukraine’s first retailer in this segment.
  • Foxtrot has been present in the market for a quarter of the century. In 2019, the Foxtrot brand celebrates its 25th anniversary.
  • GFK analysts estimate that last year alone (2018), 27.8 million Ukrainians visited Foxtrot outlets.
  • FoxClub loyalty program covers 8.2 million Ukrainians.
  • The chain is present in 90 Ukrainian cities and countries.
  • Foxtrot is an omnichannel business. It runs 162 traditional household appliances and electronics outlets (shops) and an online resource - foxtrot.com.ua.
  • 8 million clients visit foxtrot.com.ua per month.
  • Foxtrot Group of Companies and the brands it develops under the leadership of Chairman of the Supervisory Board Valerii Makovetskii take 77th place in the ranking of the country’s top-100 companies.
  • According to Ukraine’s State Fiscal Service (rating.zone), in 2018 the Foxtrot brand headed the employer ranking in the segment and found itself among Ukraine’s top-200 employers. The ranking includes the companies with the biggest officially hired staff. It does not cover the businesses funded by either state or local budgets.
  • In 2019, the Korrespondent magazine recognized Foxtrot as one of Ukraine’s top-3 valuable brands, along with TM Morshynska and Kyivstar.
  • According to Dilova Stolytsia, the Foxtrot Group of Companies and the companies it develops are among Ukraine’s top-20 eco-companies.
  • Apart from well-known Foxtrot brand, top managers of the Foxtrot Group of Companies –  Gennadiy Vykhodtsev and Valerii Makovetskii  –  develop  the Secunda watch retailer, DEPO't Center shopping malls and the  Fantasy Town entertainment areas.

And here is a comment by Chairman of the Supervisory Board Valerii Makovetskii on the position of the company in the country’s leading business rankings and its tax statistics.

– An increase in the taxes Foxtrot pays is our conscious contribution to strengthening the state of Ukraine. It is an example of the business civic-mindedness. I’m sure you’ve heard about a win-win strategy which leads to mutual gains.

The task of educating conscious taxpayers

In 2018, the company joined the Price of the State project as an information partner. Every till slip its clients received in its outlets turned into a powerful source of information. It detailed how much of the money paid by clients would be transferred to the budget as taxes. Besides, every till slip invited clients to visit the web portal of the Price of the State run by the NGO “CASE Ukraine”. 

The web portal welcomes visitors to use a calculator to visualize the tax structure, watch educational videos on taxation, get more information about the country’s large non-tax revenues. According to Valerii Makovetskii, those are the pecuniary damages paid by the Russian Federation to Ukraine. The web portal offers important, useful and interesting information. The key task of the information partners was to make it available to as many taxpayers and potential voters as possible.

In 2018, with great input from Valerii Makovetskii and due to support of Gennadiy Vykhodtsev, Foxtrot propagandized conscious tax payment. 170 thousand clients of it received conditional invoices detailing the cost of public service. Besides, 250 thousand visitors of Foxtrot outlets watched a video on budgeting principles in Ukraine. All the customers covered by this educational process were invited to visit the web site of the Price of the State.

Valeriy Makovetskiy

What made this educational project possible was the wide chain of Foxtrot outlets. The chain led by Valerii Makovetskii has shops in 90 cities and towns of Ukraine. Executive Director of NGO CASE Ukraine Dmytro Boyarchuk thanked the partners for cooperation: “Partnership with Foxtrot has considerably enriched our project. We’ve received new followers of the idea of transparent tax payment. We are happy to find like-minded people at Foxtrot. They not only pay impressive taxes to the budget but also consistently educate conscious, active and demanding taxpayers, future voters."

Why Foxtrot concerns with educating conscious taxpayers

In 2018, the top managers of the Foxtrot Group of Companies made a strategic decision to become information partners of the project “The Price of the State”. It is an educational project targeting voters. It was launched to make them aware of the real cost of state service. The Price of the State is implemented by the Center for Social and Economic Research “CASE Ukraine” and Pact in partnership with the Anti-Corruption Action Center under the ENGAGE! Civic Engagement Program. The Price of the State is funded by the United States Agency for International Development (USAID).

Why do Foxtrot and Valerii Makovetskii in person pay special attention to educating conscious taxpayers? Because the taxes paid by the Foxtrot Group of Companies are strengthening the state, which is making the economy stronger. As a result, population’s welfare is improving. And then these customers will come to the company to buy household appliances and electronics. In its turn, Foxtrot will transfer a part of its income to the state budget as taxes. And then this money will be spent to strengthen the state budget-funded companies. That is why everyone involved in this process is benefiting – trade-taxes-state-funding-customers-trade.

About Valerii Makovetskyi – biography

Valerii Makovetskii

Valerii Makovetskyi was born on 15 February, 1961 in Taldy-Korgan (Almaty oblast, the Republic of Kazakhstan)

Education

  • 1978 - finished secondary school No. 9 located near the Kommunarsk railway station, in the northern part of Alchevsk.
  • 1984 – graduated from the Kommunarsk Mining and Metallurgical Institute, the Department of Mechanical Engineering, a degree with honors.

Working experience

1981 – Alchevsk. Started working at the Kommunarsk Metallurgical Plant.

1983 – Melitopol. Worked at the October 23rd Machine-Tool Plant as a lathe operator.

1985 – Kyiv. Worked as a senior foreman of the engineering workshop at the Kyiv Artem Production Association. Today it is the Artem Holding Company.

Entrepreneurship

1994 – Valerii Makovetskyi and his partner Gennadiy Vykhodtsev wholesale household appliances and electronics.

1996 – Valerii Makovetskyi and his partners develop a retail household appliances and electronics chain.

1997 – retail sale of household appliances and electronics under the Foxtrot brand within Ukraine.

2004 –Valerii Makovetskyi develops the Foxtrot Group of Companies.

And here let us cite Valerii Makovetskyi as commenting on fair (and not fair enough) tax payment in our country: “Our country is facing the situation when a part of electronics brands (for instance, Apple) sell their products under grey schemes and pay taxes only partially, if any. Yes, these products are cheaper, due to the taxes evaded. Besides, there are always customers who prefer these products. But I hope that our literate and conscious citizens can change this situation. People will stop financing those benefiting from so called corruption rent.”

 

The task of educating conscious taxpayers

In 2018, the company joined the Price of the State project as an information partner. Every till slip its clients received in its outlets turned into a powerful source of information. It detailed how much of the money paid by clients would be transferred to the budget as taxes. Besides, every till slip invited clients to visit the web portal of the Price of the State run by the NGO “CASE Ukraine”. 

The web portal welcomes visitors to use a calculator to visualize the tax structure, watch educational videos on taxation, get more information about the country’s large non-tax revenues. According to Valerii Makovetskii, those are the pecuniary damages paid by the Russian Federation to Ukraine. The web portal offers important, useful and interesting information. The key task of the information partners was to make it available to as many taxpayers and potential voters as possible.

In 2018, with great input from Valerii Makovetskii and due to support of Gennadiy Vykhodtsev, Foxtrot propagandized conscious tax payment. 170 thousand clients of it received conditional invoices detailing the cost of public service. Besides, 250 thousand visitors of Foxtrot outlets watched a video on budgeting principles in Ukraine. All the customers covered by this educational process were invited to visit the web site of the Price of the State.

What made this educational project possible was the wide chain of Foxtrot outlets. The chain led by Valerii Makovetskii has shops in 90 cities and towns of Ukraine. Executive Director of NGO CASE Ukraine Dmytro Boyarchuk thanked the partners for cooperation: “Partnership with Foxtrot has considerably enriched our project. We’ve received new followers of the idea of transparent tax payment. We are happy to find like-minded people at Foxtrot. They not only pay impressive taxes to the budget but also consistently educate conscious, active and demanding taxpayers, future voters."

As you can see, Foxtrot benefits from being a partner of CASE Ukraine’s educational project. It helps to change people’s values and make them conscious citizens. Grey schemes are breaking. Business becomes more transparent. The economy is growing. Foxtrot brand is growing.

By the way, being a responsible business and a fair taxpayer is a business principle Foxtrot has adhered to over the past 25 years.

  1. Responsibility for services granted. All the companies working under the Foxtrot brand cultivate responsibility for the services they grant to consumers. Foxtrot Group of Companies sets service quality standards in the non-food retail market. Continuous improvements of the service quality is good for the society as a whole.
  1. Personnel development. Foxtrot Group of Companies as well as Valerii Makovetskii and Gennadiy Vykhodtsev in person invest in personnel development. Why? Personnel development is good for the brand development.
  1. Rational activities. In the company, all the activities are based on estimation and pragmatism. It’s important! Foxtrot owners, top managements and analysts take into account not only short-term profit but also long-term prospects.
  1. Loyalty and commitment to the company’s values. The staff of the brands developed by the Group and Valerii Makovetskii share the feeling of unity and work as a team to achieve their common and personal goals.
  1. Leadership. All the Foxtrot Group companies move in the same direction. Their leaders are Valerii Makovetskii and Gennadiy Vykhodtsev. Together they are developing ways to move their business ahead. They are implementing their personal life goals and are true experts in the retail segment.

Valerii Makovetskyi tells about white taxation and its part in building the healthy business environment in Ukraine.

Based on results of cooperation with CASE Ukraine, Valerii Makovetskii and Gennadiy Vykhodtsev were expressed gratitude for their efforts to make Ukrainians aware of budgeting principles and state institutions funding. At the presentation of the Price of the State project, Valerii Makovetskii gave in interview to the Interfax-Ukraine agency in which he clearly outlined Foxtrot’s position. A fragment of this interview seems to be the best ending for this story about why Foxtrot pays taxes fairly and teaches others to do so:

"When there are no taxes, there will be nothing. When there are no taxes, there is no control of them, when the state is weak, the consequences are like Crimea and Donbas. If we do not think about it now, we may lose the country. In my opinion, we should keep working and explaining to people why paying taxes and controlling state expenses are necessary. We believe in the success of what we are doing. Undoubtedly, it is hard work, it requires a lot of attention and effort but we should do it together!."

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