Launch of New Initiative for Ukraine's Defense Industry
The President of Ukraine, Volodymyr Zelensky, has announced the implementation of a new initiative called Defence City, aimed at supporting domestic defense enterprises. This was reported by Defense Minister Denys Shmyhal.
On August 21, members of parliament voted on two significant pieces of legislation: No. 13420 "On Amendments to the Tax Code of Ukraine and Other Laws Regarding Support for Defense Sector Enterprises" and No. 13421 "On Amendments to Section XXI of the Customs Code of Ukraine Regarding Support for Defense Enterprises".
According to the official website of the Verkhovna Rada, Bill No. 13420 has indeed been returned with the President's signature. However, there is currently no information about Bill No. 13421 on the site as of 13:50.
At the same time, the head of the defense ministry reminded that Defence City provides a range of benefits for weapon and military equipment manufacturers:
- Exemption from profit tax (if reinvested);
- Exemption from land and property taxes (if used in production);
- Exemption from environmental tax;
- Simplified customs procedures;
- Simplified regime for international transfer of defense products;
- Relocation features and measures to enhance the protection of production capacities will be supported by the state.
"Manufacturers of defense products that are strategically important for the country's defense capability and comply with transparency requirements will be able to openly participate in Defence City," added Denys Shmyhal.
Before the vote on the laws, three major Ukrainian associations representing almost the entire domestic private arms market expressed their opinions about the new regime. More on this can be found in the article "Arms Production Reform: Is the Idea Good?"
