Important Draft Laws. Issue 49: Abolishing Business Permits, Banning E-Cigarettes, and Fixed Taxes for Sailors

Abolishing 63 business permits

Bill No. 13554 proposes abolishing 63 permits, approvals, and certificates required for various types of economic activity. For example, it would remove the certificate of state registration of a hazardous factor, which confirmed that a harmful factor—such as a chemical substance—had been entered into the state register and considered in health risk assessments. The Law on the Public Health System added this certificate to the List of Permitting Documents, but did not define the procedure, conditions, or requirements for obtaining it.

The draft also proposes removing from the Law on the Fundamentals of Ukrainian Health Care Legislation the requirement to obtain a special permit to practice folk medicine (the government abolished the issuance procedure in April) and provisions setting qualification requirements for sole proprietors (FOPs) engaged in folk medicine (healing). However, folk healers would still be required to register as FOPs, declare their activities, and pay taxes.

From 2012 until its abolition, such permits had been issued under the Procedure for Issuing and Revoking a Special Permit to Practice Folk Medicine (Healing). In 2018, then–Minister of Health Ulana Suprun spoke out against granting them, arguing that the Ministry of Health could not issue permits for methods whose safety and effectiveness could not be guaranteed.

In water management, sanitary zone projects for water intakes are currently approved by regional councils, the Verkhovna Rada of the Autonomous Republic of Crimea, and the Cabinet of Ministers. Bill No. 13554 stipulates that the Cabinet would approve the sanitary zone in emergencies or when a water intake serves multiple regions. In all other cases, no sanitary protection zones would be established. The authority to issue permits for special water use, carry out works on water fund lands, and approve limits would be transferred from the Ministry of Environmental Protection and Natural Resources and from regional and district state administrations to the State Agency for Water Resources.

In the forestry, hunting, and agricultural sectors, permits for felling seed trees, relocating animals, capturing game species for scientific purposes, and constructing reclamation systems would be abolished. The Cabinet would approve the rules for such ministers’ activities based on forest management regulations. A separate legal act would regulate the felling of plants listed in the Red Data Book of Ukraine. Currently, the Forest Code provides that felling trees and shrubs listed in the Red Data Book may be carried out only by an established procedure (which does not currently exist) and only with the permission of the Ministry of Environmental Protection and Natural Resources. The bill proposes removing this permit requirement from the ministry and obliging the Cabinet to develop the procedure.

In the energy sector, the Ministry of Energy would no longer be able to determine whether a fuel qualifies as an alternative.

In urban planning, Bill No. 13554 would remove from the Law on Architectural Activity the requirement for a city or district chief architect to approve architectural design decisions for projects in a city’s historic district. The law did not define the approval procedure, creating corruption risks and dependence on the “human factor.” Moreover, such approval is not required under other relevant legislation—neither the Law on Regulation of Urban Development nor the Law on Protection of Cultural Heritage. Projects in historic districts would still have to comply with urban planning documentation and cultural heritage protection requirements, with the architectural and urban planning council involved in their development, but without separate individual approval by the city’s chief architect.

In the education sector, the licensing of extracurricular education would be abolished, as would the requirement to obtain a permit to establish a branch of a foreign university.

In the foreign economic sector, the Ministry of Economy would no longer issue opinions on the right to conduct negotiations or register investment agreements with foreign entities.

Ban on the production, import, and sale of electronic cigarettes and related liquids

Currently, the law permits the production, import, export, wholesale, and retail sale of electronic cigarettes, refill containers, and related liquids. Applicable rules set labeling requirements, standards for liquid composition, consumer information, and packaging. Activities in this sector are subject to licensing and state oversight, and the products themselves are covered by the electronic traceability system, which tracks the circulation of goods marked with electronic excise stamps in the Electronic System from production or import to purchase by the end consumer. Bill No. 13548 proposes a complete ban on the production, import, export, wholesale, and retail sale of electronic cigarettes, refill containers, and related liquids.

Introducing fixed taxation for sailors

Currently, sailors are not covered by any special tax regime. If a Ukrainian works on a foreign vessel, they must declare their income independently, submit an annual tax return, and pay 18% personal income tax plus a 1.5% military levy—19.5% of the actual amount earned. It does not matter in which currency they are paid or in which country the vessel or employer is registered. Under these conditions, verifying the amount of earnings is difficult, so sailors either do not declare their income at all or face the risk of tax claims.

Bill No. 13530 proposes introducing a separate voluntary tax regime for sailors. It would apply only to Ukrainian tax residents—that is, individuals who either permanently reside in Ukraine, spend more than 183 days a year in the country, or have their center of vital interests here (such as family or business).

A sailor who opts for this regime would be required to file an annual tax return indicating, not their actual income, but a base salary level determined by their position (seaman, engineer, captain). The 18% personal income tax plus 5% military levy would therefore be calculated not on actual wages but on a fixed rate. These rates are set annually by the International Transport Workers’ Federation (ITF). For 2025, the base monthly rates are: captain—USD 2,267; chief engineer—USD 2,061; chief mate—USD 1,464; seaman—USD 673. In other words, the amount of tax a sailor would pay would depend on their position rather than their actual earnings.

Under the bill, a sailor would be required to submit an application along with a set of documents, including a copy of the contract with the company or a certificate from a crewing agency (confirming that the sailor has signed an employment or civil contract with a shipping company through that agency), proof of identity, and qualification documents. The Maritime Administration would verify this information within five days, after which the tax authority would have three days to decide whether to grant the sailor the special tax regime. Taxes could be paid quarterly or together with the annual tax return. If the conditions are violated—for example, if the sailor fails to file a tax return or ceases employment—they would lose the right to this regime.

The State Tax Service would not verify the actual amount of a sailor’s salary. However, it would check other information—whether the sailor held the stated position, whether their documents are genuine, and whether the contract is valid. If a sailor provided false information by declaring a lower position than the one they actually held, the tax authority would have the right to assess the unpaid tax and impose a fine equal to 100% of the underpaid amount.

New rules for accounting, reporting, and auditing of the Pension Fund and the Social Insurance Fund

Currently, the Pension Fund and the Social Insurance Fund maintain accounts and submit reports without clearly distinguishing, for example, funds from the unified social contribution, state budget allocations, and charitable donations. All these funds are recorded together. Accounting by separate categories—such as pension provision, insurance, special payments, and administrative expenses—would enable better identification of the sources and intended use of funds. An audit is not mandatory for either fund. In addition, the Pension Fund must publish only its annual financial statements, while interim reports (quarterly, semiannual, or nine-month) may remain unpublished.

Bills Nos. 13551 and 13552 propose requiring the Pension Fund and the Social Insurance Fund to maintain accounting and reporting separately for each category of fund use. For example, one approach would apply to pensions, insurance against illness or accident, and future medical insurance; another would apply to state budget payments and administrative expenses. The Ministry of Social Policy would establish the specific rules in coordination with the Ministry of Finance.

These funds would be required to undergo an external audit each year. Such audits could be conducted only by specialized auditing firms authorized to provide services to public-interest entities. No firm could audit the same fund for over 10 consecutive years. The funds would also be required to publish their reports quarterly.

The Pension Fund’s budget would be restructured to divide expenses into five categories: pensions, insurance, medical insurance, special payments, and administrative costs. For each category, the sources of revenue would be specified, including the unified social contribution, budget funds, fines, charitable donations, and other sources.

Expanding data and new rules for the Register of Seized Assets

The Asset Recovery and Management Agency (ARMA) maintains a register of property seized in criminal proceedings. The register contains information on the assets, their value, the investigative bodies and courts that ordered the seizure, and basic characteristics of the property such as its description and appraised value.

Bill No. 13510 proposes significantly expanding the list of data in the register. ARMA would be required to record the court hearing the case, information on suspects and defendants, and details of ARMA’s actions with the assets—whether stored, transferred, managed, or sold—as well as the authority that lifted the seizure. The register would also include information on temporary managers, management contracts, amounts of income and expenses, confiscation orders, and even decisions by foreign authorities on the seizure or return of property to Ukraine.

As is currently the case, investigators, judges, and prosecutors would be required to send information on seized assets to the agency electronically, but the bill proposes that this be done within one business day of any change in the asset’s status (for example, if a prosecutor decides to lift the seizure or a foreign authority issues a decision to seize or confiscate the asset).

The bill also proposes making the register more user-friendly: It would operate around the clock, include a search function, and openly display aggregate amounts and statistics. Specific information, including details about the investigators handling the cases, the suspects, and the location of the assets, would remain closed.

New rules for engaging civilian specialists in cyber defense

Bill No. 13592 proposes creating a system that would enable private cybersecurity specialists to contribute to Ukraine’s defense in cyberspace. To this end, the bill envisions establishing a professional organization—the League for Deterring Destructive Activities in Cyberspace.

To establish the League, cybersecurity specialists would be required to hold a founding congress, approve a charter, elect governing bodies (a council, a chair, and committees), and compile a database of members. The League could admit specialists who meet specific criteria: possess relevant experience, hold an education certificate, have resided in Ukraine for at least five years, have no criminal record or debts, and are not subject to special economic or other restrictive measures (sanctions). The League would verify members’ reputations and compliance with these requirements. The law does not provide for an independent body to vet the initial specialists (founders), meaning they would assess themselves; however, the Cabinet of Ministers would be required to approve the application procedure and set requirements for certificates and the database to ensure transparency.

Government bodies would be permitted to engage only League specialists for cybersecurity at critical infrastructure facilities and in the banking, communications, and postal sectors, data centers, social networks, and internet platforms, if these facilities are essential for security or the provision of public services. These specialists would respond to cyber incidents, assist with vulnerability analysis, and participate in training, stress tests, and measures to counter aggression. In addition, the League would draft legislation and regulations on cybersecurity and collect and analyze international best practices in cyber incident response. However, League specialists would not be involved in military cyber operations or work involving state secrets.

The government, the Security Service of Ukraine (SBU), the State Service of Special Communications and Information Protection, and the National Bank would jointly approve the facilities where specialists may work and develop rules for their engagement. The Cabinet of Ministers would establish the procedure for compensating the costs of these specialists, and the State Service of Special Communications and Information Protection would be responsible for policy in this area.

Support for rural and mountain areas

Maksym Zaremskyi, a member of the Budget Committee and the Servant of the People faction, registered 31 draft laws in two weeks, with 20 focusing on directing state budget funds toward developing rural and mountain areas. Most of these initiatives would finance specific village programs from the reserve fund. In particular, he proposes allocating UAH 5 billion for road repairs in hard-to-reach villages (No. 13521), UAH 500 million for street lighting in villages with fewer than 2,000 residents (No. 13522), UAH 1 billion for bus stops in villages (No. 13534), UAH 2 billion for snow removal equipment for mountain communities (No. 13535), and UAH 1 billion each for equipping rural health posts (No. 13542), pharmacy outlets (No. 13547), and rural schools (No. 113556). Another UAH 2 billion would be allocated for installing indoor restrooms in rural schools (No. 13560), and UAH 1 billion for microgrants to build greenhouses (No. 13569). Altogether, these initiatives would require UAH 16.5 billion.

Several bills propose amendments to the Budget Code. For example, the MP proposes enshrining mandatory funding in law for modernizing water supply in mountain settlements (No. 13523) and purchasing sanitary transport for them (No. 13546). Other proposals include introducing a mountain medical subvention (No. 13538), a subvention for mobile medical units in hard-to-reach villages (No. 13539), and separate funding for periodic visits by medical teams to small communities (No. 13541).

A separate set of initiatives focuses on supporting medical and rehabilitation workers in rural areas. The MP proposes providing them with official housing, the option to acquire ownership after 10 years of service, and a one-time allowance and other benefits (No. 13540).

MP Maksym Zaremskyi proposes stipulating that the social development of villages should include constructing gas networks, with state co-financing of at least 20% of capital investment (No. 13536).

His initiatives also include developing rural entrepreneurship through microgrants of up to UAH 100,000 for starting or expanding a microbusiness (No. 13565); supporting agricultural producers through the leasing of precision farming equipment, including agrarian drones (No. 13583); and funding for culture—allocating 5% of State Fund for Regional Development (SFRD) resources to repair village cultural centers (No. 13584) and introducing a new cultural subvention for costumes, instruments, and arts events in villages (No. 13586).

In most bills, the MP explicitly requires the government to allocate funds for implementing the proposed changes in the next draft budget. Some bills also allow for attracting grants, international aid, or preferential loans.