PwC Legal Ukraine has successfully represented Pravexbank in a dispute against Ukraine's tax authority.
According to PwC Legal, the case was related to recognition of bad debt provisions for tax purposes, which had never been raised by the tax authorities before, “considering that Ukrainian joint-stock bank Pravexbank's accounting rules are strict and complicated.”
In challenging the position of Pravexbank, the tax authorities adhered to the literal interpretation of the law. According to PwC Legal Ukraine, in its defense on behalf of Pravexbank, it "focused on the applicability of a complex interpretation of the law, instead of a literal one. As a result, the State Fiscal Service partially supported the position of Pravexbank and cancelled the most significant part of tax reassessment."
In addition, PwC Legal Ukraine reported, "in the course of a pre-trial procedure PwC Legal Ukraine insisted on the issue of the general tax ruling by the Ministry of the Finance of Ukraine to strengthen Pravexbank’s arguments. Such ruling applies to all banks of Ukraine and prevents similar tax assessments in future. Further, PwC Legal successfully challenged the remaining part of the tax assessment."
The PwC Legal team was led by Partner Dmytro Donets and Head of Tax Litigation Zhanna Brazhnyk.
