Ukraine DAC7 Rules for Digital Platforms Approved

In September 2025, the Ukrainian Ministry of Finance announced Cabinet approval of a draft law amending the Tax Code to implement the EU's DAC7 and the OECD's Model Rules for Reporting by Platform Operators. The draft law has since passed its first reading in Parliament, marking a significant step toward regulating and taxing income earned through digital platforms.

DAC 7 Rules and Implementation Timeline

The draft law aligns with the EU's DAC 7 and the OECD's Model Rules and focuses on increasing transparency in the digital economy by requiring platform operators to collect and report information about sellers and service providers who earn income through their platforms. A key feature of the system is the introduction of preferential tax treatment for certain qualifying income earned through digital platforms.

Under the law, qualifying income earned through digital platforms would be taxed at a reduced rate of 5%, provided the individual’s annual income does not exceed 834 times the minimum wage applicable on January 1 of the reporting year. The draft law also provides a limited exemption for income derived from the sale of goods through digital platforms, provided sellers meet certain criteria.

The draft law sets substantial financial penalties for non-compliance, including a fine equal to 100 times the minimum wage for failing to submit required reports, a penalty equal to 0.5 times the minimum wage for late filing, and a penalty equal to 0.5 times the minimum wage for each affected seller for inaccurate or incomplete reporting.

On the implementation timeline, registration requirements should take effect from November 1, 2026, meaning both domestic and non-resident operators falling within the scope of the rules will need to register with the Ukrainian Tax Authorities before the reporting regime becomes fully operational. Most tax and reporting provisions, including the 5% preferential rate, will apply from January 1, 2027, and the first reporting period will cover the 2027 calendar year. Platform operators will therefore need to compile and submit their first annual reports in early 2028.

Conclusion

The adoption of the draft law is both politically and economically important because it supports Ukraine’s wider commitments to international institutions, including the IMF, the OECD, and the European Union. Although the legislation has passed its first reading, it must still undergo further parliamentary review and amendment before becoming law. 

Certain changes to the scope of reporting obligations, implementation timelines, and technical compliance requirements for platform operators and taxable persons might be made in the second reading. Therefore, all affected parties should monitor for the final version of the legislation to ensure they remain up to date.

Source: Ukrainian Parliament, VATabout