“We’re against the return of corruption to the VAT system.”
– Finance Minister Oleksandr Danylyuk
Faking it Danylyuk has faced a series of attacks that have increased in their severity.
Prosecutors are looking into the minister’s time as an investment banker in London. He is suspected of evading his Ukrainian taxes while there. The case has raised eyebrows, given that a double taxation treaty exists between Ukraine and the United Kingdom. Other attacks have attempted to humiliate the 42-year-old politician. On Nov. 30, an anonymously run Facebook page called "nemovchi" (don’t keep silent) accused Danylyuk of sexually harassing a colleague via a series of Facebook chat screenshots.
The images — which had fonts and image sizes different from those used by Facebook — also used a picture of former Privatbank employee Viktoria Strakhova as the avatar of the alleged accuser.
Strakhova said in her own Facebook post that the messages were faked, saying “apparently, not only do the opponents of the finance minister have chicken brains, but also certain sexual deviations."
"The whole exchange is a photoshop," she added.
Budget cudgel Other elements of the VAT system remain open to political manipulation.
One outwardly mundane but extremely fraught example is the VAT on agricultural oil.
On Dec. 7, the Rada canceled the VAT on exports of unprocessed agricultural oils in a stated bid to increase value-added production in Ukraine. The change goes into effect March 1.
But the move has led to an outcry from some producers, who argue that the move unfairly benefits companies that can launch value-added agricultural oil production within three months.
“If this was really a local production strategy, the government would be implementing a full, official plan,” said Taras Vysotsky, director general of the Ukrainian Agribusiness Club. “But when there are only two months given, there’s a sense that this was done to support certain producers.”
Vysotsky added that it will lead to “direct losses” for much of the industry. “Unfortunately, yes, it’s being used as a weapon,” he said.