OREANDA-NEWS. April 12, 2012. As the media’s interest in luxury tax introduction has increased recently, the Ministry of Finance reports as follows.

Within the framework of public finance improvement programs based on the financial and economic crisis outcomes, many countries now raise the issue of using the wealth taxes.

For instance, with the purpose to reduce its budget deficit, Hungary has introduced the net wealth tax categorizing real estate, water and air transport (luxurious boats, aircrafts, and helicopters), powerful automobiles, etc. as net wealth. Tax base is determined out of the property’s market value.

The world practice applies several property tax groups that may actually be included with wealth taxes, most common of them being the real estate tax and net wealth taxes.

Real estate taxes are levied on a permanent basis (annually as a rule) from the real estate owners or users. Various countries such as Denmark, Korea, Japan, United States, Canada, UK, and Austria have various approaches to assess the real estate taxable base, specifically, this may be the property appraised value as calculated based on its market value or rent fee, or other property features such as size, location, etc.

Some countries like Luxembourg, Switzerland, Norway, or France levy taxes from a person’s gained wealth (real estate, securities, bank deposits or savings, or investments into private companies’ or corporations’ real capital), based on net value of assets.

In order to increase wealthy citizens’ contribution to supplementing the budget and fairly allocate wealth within the Ukrainian society, the Ministry of Finance has drafted Law of Ukraine "On Amending the Tax Code of Ukraine concerning the Luxury Tax Introduction".

Draft Law stipulates introducing the taxation of separate items of movable (passenger cars and motorcycles with powerful engines, luxurious boats, aircrafts, and helicopters) and immovable property (large apartments and houses) within the time period when individuals own such items.

At the moment, draft Law undergoes coordination by central executive authorities.

Any sound proposals made in the course of the Law discussion will be definitely taken into account in the course of its further processing.