SOCAR leads in tax payments from fuel sales in Ukraine

In the first quarter of this year, "SOCAR Ukraine," a subsidiary of the State Oil Company of Azerbaijan Republic (SOCAR) in Ukraine, was the leading company in terms of tax payments from fuel sales, Azernews reports, citing "Unian".

This was revealed in a study conducted by specialists from the Ukrainian Institute of Socio-Economic Transformation (ISET), the CASE analytical centre, and the Economic Expert Platform, aimed at assessing the proportion of "shadow" activity in excisable goods and its trends.

According to the study, "SOCAR Ukraine" also ranked second in terms of tax payments for its employees.

It is worth noting that in three quarters of the previous year, "SOCAR Ukraine" was the top taxpayer in terms of fuel sales, and in two quarters, it led in terms of taxes paid for its employees.

As noted by the study's authors, excise taxes serve a dual purpose: to curb consumption of certain goods due to price elasticity and to contribute to government revenue, which is generally less distortive than many other forms of taxation.

The authors of the study suggested that the full-scale war likely resulted in a slight increase in the share of "shadow" sales (though with a decrease in absolute numbers) due to a sharp decline in legal sales. However, measures implemented during 2023 significantly reduced this share over the year, with the illegal market volume decreasing by 2.5 times on average.