Ukraine acceded to the World Trade Organization (WTO) in 2008. The WTO’s first review of the trade practices in Ukraine took place on 19 and 21 April 2016. A detailed report was prepared by the WTO Secretariat in connection with the trade review.

All Ukraine’s tariff lines are bound and the simple average bound rate is 6.1% (10.8% for agricultural products and 4.9% for manufactured products). The bound tariff rate is the maximum level to which the most favored nation (MFN) tariff could rise on a given commodity. The applied MFN rates were a little below the bound levels in 2015. Generally the average applied MFN tariffs on industrial products do not exceed 10% except for clothing, footwear, some accessories and a few animal products.

Value added tax (VAT) is imposed on domestically produced and imported goods and services at a 20% standard rate and from 1 January 2014 there is also a reduced rate of 7% on medicines, medical supplies and equipment for clinical trials. Exports, international transportation services, aircraft maintenance for international routes and supplies for sea vessels are zero rated. Banking, insurance and asset management services are exempt. Some time-limited VAT and import duty exemptions are given to certain industries and projects. Special VAT regimes apply to agriculture, forestry and fisheries. Electronic VAT administration was introduced on 1 July 2015.

Excise taxes apply to alcohol and tobacco products; petroleum products; biodiesel; motor vehicles; and electricity. Excise duty rates are revised annually.

Industrial subsidies exist in the form of sectoral programs in coal, shipbuilding, aircraft and aerospace, agricultural machinery and publications. Tax concessions are available to enterprises operating in special economic zones, priority territories and industrial parks. Agriculture receives government support and high import protection for some products. However there are export quotas and export duties, and agricultural enterprises have had problems obtaining refunds of VAT on exports.

Ukraine has signed free trade agreements (FTAs) with the European Free Trade Association (EFTA), FYR Macedonia and Montenegro. An FTA with Canada has been signed but is not yet in force. Ukraine has also ratified the agreement for a Free Trade Area with the Commonwealth of Independent States (CIS). Negotiations with the European Union (EU) for an Association Agreement including a Deep and Comprehensive Free Trade Area (DCFTA) began in 2007. On 1 November 2014 provisional application of parts of the Association Agreement began, with full application of those parts of the agreement from 1 January 2016. Ukraine and the EU have agreed to establish a free trade area within a maximum of ten years.