The Supreme Court ordered JSC Southern Mining and Processing Plant to pay UAH 3.7 billion to the budget.
This is stated in the report of the Tax Service, Ukrainian News Agency reports.
"These are taxes and fines for the improper use of tax benefits when paying dividends by this company to Cypriot companies. Thus, the Court supported the position of the State Tax Service of Ukraine, satisfying the cassation appeal," the report says.
During the audit, the tax service found that over three years Southern Mining and Processing Plant transferred dividends to 12 shareholders - residents of Cyprus.
The total amount is UAH 29.8 billion. When paying dividends, a preferential tax rate of 5% was applied, and UAH 1.49 billion was paid to the budget.
A thorough check showed that these Cypriot companies are “technical”.
The funds received were promptly transferred to companies resident in the Netherlands.
Therefore, Cypriot companies are not beneficial owners of income, preferential taxation is illegal.
Therefore, the State Tax Service has additionally assessed the main payment - UAH 2.98 billion and fines - UAH 0.8 billion.
The company appealed Tax Service position in court.
However, the Supreme Court put an end to the legal hassle, overturning the decisions of the two first instances.
After the court decision is published, JSC Southern Mining and Processing Plant has 10 days to pay the relevant funds to the budget.
In case of non-payment, the accounts will be blocked through the court and the property will be seized for the amount of the debt.
The inspection materials will be transferred to law enforcement agencies for appropriate processing.
As Ukrainian News Agency earlier reported, Southern Mining and Processing Plant is among the five largest iron ore producers and is the main sinter producer in Ukraine.
In September 2017, Metalotekhnika Limited Liability Company, which previously owned 25.78% of Southern Mining and Processing Plant shares, withdrew from the company's shareholders.
In July 2014, as part of the merger of Metinvest's mining and metallurgical assets, the Smart Group contributed 100% of the shares of Trosilia Holdings Limited (Cyprus) to the authorized capital of Metinvest B.V., which indirectly owns 46.15% of Southern Mining and Processing Plant shares.
In December 2007, Lanebrook Limited, the majority shareholder of Evraz Group, purchased 50% of the shares of the Southern Mining and Processing Plant from the PrivatBank group, along with 5 mining and metallurgical enterprises (3 coke plants, Sukha Balka, and Petrovskyi DMZ).
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