From January 1, 2025, OpenAI introduces a value added tax (VAT) of 20% on its services for users in Ukraine. This is in accordance with the norms of the Law of Ukraine №1525-IX, known as the "tax on Google."
In an official statement, the company informed users that the innovation will affect invoices starting from the new year. If a user is a registered VAT payer in Ukraine, he must specify his payer identification number in his OpenAI account by the end of 2024. If this number is not specified, the 20% VAT will be automatically added to invoices.
For Ukrainian users, this means an increase in the price of OpenAI services. For example, a monthly ChatGPT Plus subscription, which now costs $20, will cost $24 including VAT.
OpenAI is already registered as a VAT payer
According to the head of the Verkhovna Rada tax committee, Daniil Getmantsev, OpenAI became registered as a taxpayer on November 11, 2024, and received the status of VAT payer on November 12. The company will submit its first tax report on the results of the fourth quarter.
The company will submit its first tax report on the results of the fourth quarter.
What is «tax on Google»?
This tax is introduced for international corporations that provide electronic services to Ukrainian consumers, but do not have a physical presence in Ukraine. The services subject to the tax include:
- sale of electronic books, music, movies;
- video games and software;
- cloud services;
- online advertising;
The law was passed in June 2021 and went into effect on January 1, 2022. Since its implementation, the tax has generated mixed reactions. In particular, Apple has raised prices for its services in Ukraine to compensate for the new costs.
Apple has raised prices for its services in Ukraine to compensate for the new costs.
Results of the tax's implementation
In the third quarter of 2024, Ukraine received more than UAH 3.1 billion in revenue from this tax. The main contribution was made by corporations such as Google, Apple, Meta and Valve, which declared 2.2 billion hryvnias.
The tax's impact on Ukraine's economy has been significant.
What's next?
The introduction of VAT for OpenAI is another step in harmonizing international business with Ukrainian tax law. However, the question remains: will it lead to a revision of the pricing policy of other companies that do not yet charge «tax on Google»?
OpenAI users should already prepare for possible additional costs or enter their tax details to avoid automatic VAT assessment.