Case Summary:

The tax authorities claimed that the “usual price” used in “Stolychnyi TSUM’s” transactions was understated and therefore assessed an enormous VAT liability. According to ArsLegem, the client’s contracts reflected market-level prices, while the tax authorities’ approach was based on flawed calculations and assumptions. The court of first instance reviewed the arguments of both parties and found the tax authority’s actions to be unlawful.

Why This Matters:

1. Significant savings: “Stolychnyi TSUM” avoided additional financial losses of nearly UAH 100 million (approx. EUR 2.4 million).

2. Precedent for businesses: The court ruling confirms that the “usual price” is a question of fact, not a matter of arbitrary estimation, and requires professional analysis.

3. Transparency in dealings with tax authorities: The case proves that tax legislation can be successfully defended in court, even in disputes involving multimillion claims.

“The usual price is not an empty notion, but an economic indicator that must be determined based on real market conditions and specific agreements. We succeeded in showing the court that the tax authority’s claims were based on incorrect assumptions,” commented Oleksandr Petrov, partner at ArsLegem.

“We are grateful to ‘Stolychnyi TSUM’ for their trust and collaborative work. This case demonstrates that even large-scale tax assessments can be successfully challenged when supported by solid evidence and a well-structured legal position,” added a lawyer from the ArsLegem team.

ArsLegem continues to actively defend the interests of corporate clients in tax, commercial, and administrative disputes, offering comprehensive legal solutions and delivering a high standard of legal support.