Ukrainian President Petro Poroshenko has vetoed the law passed by the Verkhovna Rada which lowers the coefficient to determine the size of a social security tax, due to come into force in 2016, from 0.6 to 0.4, and increases the ceiling of individual income tax at a rate of 15% from ten to 17 minimum wages (from UAH 12,180 to UAH 20,706).

Poroshenko noted in the proposals to the law, which were posted on the official website of the Verkhovna Rada, that the law cannot be signed.

According to him, lawmakers did not note that pursuant to subparagraph E of paragraph 176.1 of Article 176 of the Tax Code, individual taxpayers are required to file a tax return on the results of the tax (reporting) year, if during this period taxable income was accrued (paid, granted) simultaneously by two or more tax agents and their total annual amount exceeds 120 minimum wages, established on January 1 of the reporting tax year.

The recalculation of the tax from the declared total annual taxable income is made in a separate addition to the tax return. In particular, 120 minimum wages are taxed at 15%, the rest, exceeding 120 minimum wages, at a rate of 20%.