Lesya Karnaukh took over the State Tax Service in the summer of 2025. Amid the full-scale war, the institution faced major challenges — ensuring stable state budget revenues, building taxpayer trust, and modernizing the STS to be effective. Today, the State Tax Service is changing its work philosophy: less formal control, more analytics, services, and effective measures against schemes. An open conversation with Acting Head of the State Tax Service of Ukraine Lesya Karnaukh about all changes in the STS.
— What new innovative services is the State Tax Service of Ukraine currently implementing to make tax payments simpler and more transparent for citizens and businesses?
In fact, the State Tax Service has been one of the most digitized state institutions for several years. Today, over 130 services are available digitally. Reporting, declarations, inquiries — all have long been online. Because we all want to save time and resources, especially during war. The tax service is not only about tax administration but also about providing quality services to every taxpayer. Thanks to everyone who pays taxes, we fill the budget, fund defense, social programs, and reconstruction.
Our philosophy is simple — electronic services must not just exist but be convenient. We consider taxpayer feedback for improvements. For example, many complaints are about the outdated Electronic Cabinet. This year, one priority is deep modernization of the Electronic Cabinet: interface, logic, flexibility. In simple terms, it must be user-friendly.
We aim to remove excessive administrative barriers — this is the basis of all our initiatives.
The tax service is maximally involved in all state digital services. We closely cooperate with other ministries. For example, we participate in launching the “National Check” program, e-Consul, joined developing new grants for sole proprietors on energy independence, working with the Ministry of Digital Transformation on e-Excise. We actively work with the Ministry of Finance and the State Treasury on improving tax debt collection mechanisms.
I can’t fail to mention Diia — we plan a project for one-click tax payments. This will simplify communication for payers when paying property taxes or personal income taxes.
From January 1, we launched e-Audit — minus manual control and subjectivity. For those working transparently, this is significant relief.
— Last fall, the STS opened Tax Consultants’ Offices. How successful has this idea been?
For us, the main thing is changing philosophy and work approaches. Previously, we were seen as a punitive body: came, checked, blocked, fined. No one explained how to solve issues. So it’s understandable that tax officials were, to put it mildly, disliked. Now, our priority is consulting. When a payer understands the algorithm, trust grows automatically. I’m instilling this philosophy in all employees. It’s not quick. But we’re ready to change.
We deliberately went to regions, opened Tax Consultants’ Offices in 20 regions. We have unified approaches, roadmaps. I emphasize: trust doesn’t come from a “consultant office” sign. It comes when business sees it’s heard and not punished for mistakes. That’s why we combine Consultants’ Offices with Service Centers — for comprehensive, not formal service.
Our approach is simple: honest payers should have it easy. Those living on schemes for years should find it hard.
What results are these changes yielding? Do you have examples or statistics showing tax revenue growth or relief for entrepreneurs?
Let me give examples. Tax invoice blocking and risky status — a top issue always discussed. Early 2025, blocking rate was 0.8%. Today — no more than 0.2%. That’s 4 times fewer blocked invoices, twice fewer risky entities. Result of systematic work. I set a clear requirement: no extra documents, maximum digitalization.
But I’ll be frank: if a payer falls into risky category — we’ll be meticulous. The state can’t fund the country, especially in war, at honest business’s expense while turning a blind eye to loophole seekers avoiding taxes.
Next. I’m a proponent of pre-trial dispute resolution. It saves time, resources, without budget losses. Late 2025 with the Business Ombudsman Council, we launched an experiment — specific tax mediation measures. There are cases where long disputes resolved without courts.
Another sore point for business — inspections. Since the moratorium, we cut them by 27%. Factual inspections significantly reduced. Planned ones only for high risks: systemic losses, anomalously low tax burden, serious industry deviations.
I always say state-business cooperation must be honest and transparent. It’s two-way.
In wartime, small and medium business support is crucial. What tax tools or programs help entrepreneurs now work and restore economy?
Small and medium business is the country’s economic rear. We simplify administration, provide clarifications, individual consultations.
Preferential regimes, deferrals, tax debt restructuring operate. We don’t seek fines — we seek solutions for business to operate, pay salaries and taxes even in tough conditions. Few try to deceive the country, evade taxes now. Everyone understands responsibility. It’s not just budget filling. It’s Ukraine’s existence, defense capability, aid to military.
Ukraine has one of the most flexible simplified taxation systems. Diia City, Defence City, grants, loans, “Own Business” program.
Tax service isn’t a fan of exemptions as they complicate administration. But we’re fans of service solutions. That’s why we’re launching new comprehensive support programs for those really working and creating jobs. Soon, with State Employment Service, based on Tax Consultants’ Offices and “Made in Ukraine” offices, we’ll present a new comprehensive service for consulting and supporting grant recipients under “Own Business.”
Does the Tax Service plan new partnerships or international projects for modern tech development and transparency in administration?
Last year we significantly activated international activities. We implement many projects — with Finland, Estonia, Belgium, Poland tax authorities. Continue EU4PFM work with European partners, restarted cooperation with US Treasury after pause.
Key partners remain IMF, World Bank.
How do you see the role of women entrepreneurs in forming the country’s tax base and Ukraine’s economic recovery?
Women entrepreneurs today are not just business — resilience, responsibility, social cohesion. Women hold business, communities, economy. They take on what was once “unwomanly.”
Ukrainian businesswoman is economic rear guardian. State’s task — maximally help those helping the state.
Finally: how can Ukraine find the “fair price” for its recovery — balancing tax burden, business support, and international investments?
Fair price is balance. Between tax burden and business capacity, control and trust, internal resources and international support.
Tax system must be predictable, fair, understandable. Then investments come, business develops, state gets resources for recovery and victory.
State as efficient manager, business with transparent rules, investors with rights protection.
Also read: Grant of up to €4,000 for internally displaced women: Kyiv Region launches business support program
Photo: Anna Tymoshok, from Lesya Karnaukh’s archive