Ukraine is considering introducing the Polish model of taxation of sole proprietorships, Danylo Hetmantsev, the chairman of the parliamentary tax committee, said in an interview.

Speaking to Novyny.Live, a Ukrainian TV channel, Mr Hetmantsev said the Ukrainian authorities often hear proposals from business and experts "to introduce taxation like in Europe".

"Having studied the examples of several countries, we took the Polish model as a model, which is the closest to us. We are now considering its implementation in Ukraine," he said.

The MP said that the single tax in Ukraine has turned from a tool to support small businesses into a "system of tax evasion for large and medium-sized businesses" and therefore needs to be changed.

"The Ukrainian finance ministry, together with the International Monetary Fund, is considering a taxation model that would be civilised, simple, transparent, understandable, and would allow us to support small businesses, rather than turn a blind eye to the way large enterprises play with taxes," he said.

The Polish model of taxation of sole proprietorships provides for a higher transaction limit (EUR 2 million versus UAH 7.8 million) and different tax rates for different types of activities (three percent for trade and 12 to 20 percent for services).

Under current Ukrainian law, sole proprietors of the third group pay three to five percent of their income and an additional UAH 1,430—22 percent of the minimum monthly wage—in unified social tax on a quarterly basis.

Employees’ salaries are subject to an 18-percent personal income tax and a 1.5-percent military duty, and the employer must pay a 22-percent unified social contribution to the budget.

During the first year of Russia’s full-scale invasion, more than 202,000 new sole proprietorships were registered in Ukraine.