Since the beginning of 2022, companies have changed their place of registration almost 19,000 times, according to Opendatabot. Most often, entrepreneurs move from Kyiv and Dnipro, as well as from Kyiv region. Oleg Gorokhovsky, co-founder of Monobank, also changed his place of registration. Previously, he was one of the largest taxpayers in Dnipropetrovska oblast, and from now on he will pay taxes in Mykolaivska oblast. Read Komersant ukrainskyi ‘s article on the reasons for these changes and why businessmen are moving their businesses from one region of Ukraine to another.
War and pressure from the tax authorities
According to Anatoliy Amelin, co-founder and director of economic programmes at the Ukrainian Institute for the Future, the relocation of businesses is primarily due to the war, but this is not the only reason.
“The main reason is the war, the risks of air strikes, the destruction of production facilities, and, accordingly, businesses are moving to new, safer areas. The second reason is relations with the authorities. A striking example is Oleg Gorokhovsky, co-owner of Monobank, who, after endless pressure from the tax authorities in Dnipropetrovska oblast, re-registered in Mykolaivska oblast and now pays taxes there,”
– amelin said.
Indeed, in early March, Oleg Gorokhovsky posted on his Facebook page that he would pay taxes in Mykolaiv region, not Dnipro, where he was previously registered.
“The last straw was a four-page request for an explanation of the income of UAH 70800, which I reported as income on the balance of my account with Interactive brokers and on which I also paid personal income tax – UAH 13000. They were interested in this income and sent a four-page request demanding to explain everything, including, as usual, the main question – who killed Kennedy,” he wrote,
– he wrote and noted that the head of the Mykolaiv Regional State Administration, Vitaliy Kim, offered him to move to his region, which is in dire need of taxes, and Gorokhovsky agreed.
Lack of staff
Another reason, according to Anatoliy Amelin, why businesses move from one region to another is the lack of staff.
“Also, depending on the business we are talking about, it is the availability of people who can work, because because of the war, a large number of people relocated to central and western Ukraine, and there is a shortage of workers,”
– he said.
Earlier, Oleksiy Miroshnychenko, President of the Confederation of Employers of Ukraine, also spoke about the problem of staff shortages. However, he stressed that the reason was not relocation but a lack of workers.
“There are cases when employers refuse to hire men of military age because they may receive a call to the military commissariat in a few days. Therefore, perhaps the state should revise the mechanism of personnel reservation for critical sectors of the economy,”
– miroshnychenko said.
But the problem of staff shortages is not limited to critical sectors of the economy. For example, in Khmelnytsky, there is an acute shortage of public transport drivers.
“We currently have at least 20 vacancies for trolleybus and bus drivers. And the need is growing every day,” said Natalia Svystun, deputy director of production at Electrotrans.
In general, according to the Confederation of Employers of Ukraine, the labour market has shrunk by more than 2 million people due to the full-scale war. Men are being drafted into the army, women are leaving the country, and those who remain cannot always do men’s jobs
Where businesses are moving to
Currently, the most popular route for business relocation is from Kyiv to Kyiv region: 981 companies have chosen this route. The second most popular route is from Kyiv region to Kyiv – 780 businesses. The route from Kyiv to Dnipropetrovska oblast rounds out the top three with 779 companies.
Wholesale companies are the most likely to relocate – 39.4% of the total. The top list also includes construction and real estate companies – 6% and 4.4% respectively.
Author: Alyona Kaplina