Co-founder of the Ukrainian multi-gaming e-sports organization Natus Vincere (NAVI) Oleksandr Kokhanovsky said that he supports the creation of a special legal regime for IT companies – Diia City.
As Kokhanovsky said during the presentation of Diia City on Monday, his plans are to raise at least $100 million investments in projects in which he is involved, while he noted that the conditions of Diia City would mean fewer risks for foreign investors.
According to him, the reduced tax rate, which will operate within Diia City, will allow Ukrainian companies to compete more successfully with foreign ones, and the strengthening of legislation in the field of intellectual property will improve the country’s image in the eyes of international investors.
“Our goal is to make Kyiv a core of e-sports in Europe. And I am very glad that now we have an ally that will speed up this process at times,” he said during the presentation.
Earlier, Deputy Chairman of the Verkhovna Rada Committee on Digital Transformation Yehor Chernev said that he hopes to adopt a legislative framework for the launch of a special legal regime Diia City by mid-summer.
The Ministry of Digital Transformation of Ukraine expects that the tax system for companies in the Diia City mode will help reduce the tax burden 5-fold.
According to Fedorov, thanks to Diia City, the income of the IT industry in Ukraine by 2025 may grow to $16.5 billion, and the number of jobs in this industry is planned to be increased to 450,000.
Design, IT, advertising, marketing and PR saw the largest growth in the declared income in 2020 among creative industries, according to the Ministry of Culture and Information Policy.
“The Ministry of Culture and Information Policy of Ukraine, together with the team of Kyiv School of Economics and with the support of the USAID Competitive Economy Program in Ukraine, prepared a study on the volume of tax revenues to the consolidated budget of Ukraine and the payment of a single contribution by business entities in the field of creative industries in 2019 and 2020,” the ministry’s press service said.
It is noted that in 2020 the declared income fell more compared to the previous year in the performance sector (less by 17%), audiovisual sector (less by 8%), book publishing, libraries and museums (less by 3% each).
“The fall in VAT, which indicates a decrease in the volume of sales of goods and services, in some sectors reached 50% compared to 2019: theater and concert activities [less by 53%], film screenings [less by 45%], the operation of theater and concert halls and activities to support them [less by 42-43%], activities in the field of television broadcasting [less by 38%], and the functioning of museums [less by 35%],” the report said.
The following sectors showed the largest growth in the declared volume of income in 2020: design (more by 31%), IT (more by 26%), advertising, marketing, and PR (more by 5%).
“Despite the quarantine measures, registration of new businesses did not stop in 2020. Since the growth in tax revenues occurred faster than the growth in the number of business entities, this may indirectly indicate an increase in the tax burden,” the ministry said.
Kyivstar, the mobile network operator, has announced the launch of the Open Telecom Platform, an online platform for interaction with IT grocery companies, which allows connecting to the operator’s services and using its data sets for product development and testing.
“Tomorrow we will take the first step. We will present a kind of portal of data versions for our potential partners – Open Telecom Platform from Kyivstar. It will give them the opportunity to connect to us, integrate with us and use some of the more popular service options that we are selling right now as a kind of trial version for creating own products, ideas or applications,” Kyivstar President of Alexander Komarov said during the online forum Lviv IT Arena on Friday.
According to him, the available options for using the portal are largely related to the capabilities and data available to Kyivstar as the largest Ukrainian operator.
President of Ukraine Volodymyr Zelensky has set the government to draft and submit to the Verkhovna Rada bills aimed at developing the IT industry in Ukraine.
According to the presidential website, Zelensky signed relevant decree No. 371/2020 on September 3, 2020.
According to the document, the Cabinet of Ministers, with the involvement of representatives of government agencies, business associations, independent experts and MPs, should draft and submit to the parliament bills aimed at stimulating the implementation of economic activities in the field of information technologies within three months.
In particular, at the legislative level, the temporal features of the taxation of salaries of IT specialists who are in labour relations with IT companies should be determined in order to establish an effective level of the tax burden and promote the shadowing of the salary sphere and increase the competitiveness of internal IT companies in the external market.
The president also insists on improving the procedure for carrying out procedural actions in the course of criminal proceedings in order to prevent unjustified interference in the activities of IT companies.
In addition, according to the decree, the government should improve the procedures for obtaining an immigration permit by IT specialists who are foreigners or stateless persons and immigrating to Ukraine and obtaining a work permit for foreigners and stateless persons by an employer (IT company).
The Cabinet of Ministers should also contribute to the development of education in the field of information technology and the integration of the best world practices into the system of training IT specialists to increase their competitiveness in the labour market.
According to the document, the improvement of vocational training, retraining and advanced training of the unemployed should be ensured be involving educational institutions that train specialists in the IT field.
The decree comes into force on the day of its publication.
The Cabinet of Ministers of Ukraine has offered 5,000 Belarusian IT specialists an opportunity to migrate to Ukraine, Deputy Prime Minister, Digital Transformation Minister of Ukraine Mykhailo Fedorov said.
“Some 5,000 quotas were distributed among Ukraine’s regions in which there is the largest number of IT companies. Dnipropetrovsk, Odesa and Lviv regions can attract 600 specialists each, Kharkiv region – 700 and Kyiv – 2,500,” the minister said on his Facebook page on Friday.
Recent serious disruptions to the Internet, mobile communication and banking services forced IT companies in Belarus to look for opportunities to move to another country, Fedorov said.
The minister also noted that Ukrainian companies can also offer jobs to such foreigners.
“Immigration within these quotas allows foreign IT specialists to find jobs with the same conditions as Ukrainian citizens,” he said.
The largest number of vacancies in 2018 was offered in the field of sales, IT, telecoms and marketing, according to a study conducted by the international recruiting portal HeadHunter Ukraine.
According to its press release, with reference to the results of the survey, last year both a rise and a decline were observed in the labor market of Ukraine.
More than half of respondents, describing the situation in the industry where their company operates, called it stable or noted some growth and positive dynamics.
According to HeadHunter Ukraine, the regional structure of vacancies and resumes last year remained unchanged. The top five regions include Kyiv, Kharkiv, Dnipropetrovsk, Odesa, and Lviv regions. In terms of cities, the largest number of both vacancies and resumes was presented in the capital.
According to the study, competition in the labor market in the country in 2018 was mainly at the level of three or four people per vacancy. The growth of the load on one vacant job of up to five people was recorded in October-December.
