TRAVEL RETAIL Ukraine LLC, the case of customs duties return

The bankruptcy and taxation attorney provided legal assistance in the administrative case regarding the obligation to collect from the State Budget of Ukraine in favor of Travel Retail Ukraine LLC erroneously paid excise tax liabilities for the sale of excisable goods in the amount of UAH 18.07 million and a penalty in the amount of UAH 284.6 thousand.

The relevant decision was made by the Kharkiv District Administrative Court on 11 February - 2021 in the case № 520/15397/2020.

The court confirmed that Travel Retail Ukraine LLC was registered as a payer of excise tax at the main place of registration in the State Tax Service in Kharkiv region. Trade activities were carried out by the plaintiff in duty-free shops to individual passengers of international trips, as well as to the citizens traveling outside the customs territory of Ukraine. The plaintiff had two duty-free shops, one of which is located on the territory of the international checkpoint "Goptivka".

From January 2015 to February 2020, the plaintiff paid excise tax on retail trade for excisable goods to the Department of the State Treasury Service of Ukraine in Dergachiv district of the village Kozacha Lopan.

In 2015, the plaintiff paid excise tax for the total amount of UAH 1.585 million. In 2016 the tax amounted UAH 3.03 millions. In 2017 the total amount made UAH 4.831 millions. In 2018, 2019, 2020 the plaintiff paid the amount of excise tax in the amount of UAH 10.737 million.

The Client's legal position was based on the following: Paragraph 213.2.1 of the part 213.2 Article 213 of the CCU stipulates that transactions on export of excisable goods by a taxpayer outside the customs territory of Ukraine are not subject to excise tax.

Article 82 of the Customs Code of Ukraine stipulates that export is a customs regime where Ukrainian goods are released for free circulation outside the customs territory of the country without any obligation to re-import them. 

Goods exported from the customs territory of Ukraine are placed under the customs regime of duty-free trade. Thus, the placement of Ukrainian goods in the customs regime of duty-free trade for tax purposes is considered an export of such goods. Article 145 of the CCU stipulates that foreign goods placed under the customs regime of duty-free trade retain the status of foreign goods, and Ukrainian goods placed under the customs regime of duty-free trade receive the status of foreign goods.

Taking into account the above norms of the Tax Code of Ukraine, the CCU, the plaintiff is not a payer of excise tax on retail trade in excisable goods, as it carried out the sale of excisable goods in the trade establishment, which is in the customs regime of duty-free trade.

Thus, the amount of excise tax paid by the plaintiff, which is refundable is UAH 18 072 945 (eighteen million seventy-two thousand nine hundred five) and 00 kop.

The court has fully satisfied the claims.