Exclusive The problem of VAT refund in Ukraine: the case of Centravis

The company is refunding VAT in court – cases worth UAH 115 million are pending

The VAT refund situation in Ukraine has deteriorated significantly since the beginning of 2025. Until recently, the debt to Ukrainian businesses had reached over UAH 30 billion. This problem is particularly acute for exporting companies, which are effectively losing their working capital. In particular, the problem of non-reimbursement of VAT has also affected Centravis, a leading global manufacturer of seamless stainless steel pipes, which ranks 4th in the European Union and 9th in the world in terms of sales, with about 99% of its products going for export.

Current situation

Recently, the situation with VAT refunds for Centravis’ transactions with the Dniprospezialstal plant has undergone significant changes.

In June 2025, the Court of Cassation ruled in favor of the company regarding budget refunds for the period from February 2022 to January 2023. The decision was enforced by the tax authority, and the company received a budget refund in the amount of UAH 150 million.

In addition, in June 2025, the company won cases in the court of first instance regarding the negative value included in the tax credit for the next reporting (tax) period for the period from February 2023 to August 2023 (UAH 91 million), and the court of appeal regarding budget reimbursement for October 2023 (UAH 11 million). These decisions will soon be appealed by the tax authority to the courts of appeal and cassation, respectively.

Currently, the situation regarding budget reimbursement for the period of September 2023 (UAH 13 million) remains unchanged – since February 5, 2025, the case has been pending in the court of cassation.

As of today, cases totaling UAH 115 million are pending in court. Budget refunds for the current periods are made by the state in accordance with the terms and procedures established by the current legislation of Ukraine.

Reasons for delays

In our opinion, the reason for the delays in VAT refunds for transactions with the Dniprospezialstal plant is the inconsistency of the provisions of the current legislation of Ukraine and the lack of official explanations from the competent authorities regarding the resolution of such inconsistencies. Thus, the only way for the company to protect its rights is to go to court.

However, due to the inefficiency of the judicial system, which consists of significant violations of the deadlines for consideration of cases established by law, as well as the established practice of tax authorities not complying with court decisions that have entered into legal force until the final decision is made by the court of cassation, this process (until the court decision is enforced by the tax authority) takes several years.

Impact on production

The situation with the tax authority’s failure to confirm and reimburse budgetary compensation for transactions with the Dniprospezialstal plant for the period from February 2023 to October 2023 has an extremely negative impact on the company’s activities.

Our enterprise is located in the city of Nikopol, Dnipropetrovsk region, which is in the zone of active hostilities, 7 km from the occupied Energodar, and suffers from constant shelling by Russian occupation forces with heavy artillery and UAVs. The targets of the attacks are the premises of production workshops, administrative buildings, and warehouses of the enterprise.

Despite the difficulties, we continue to work. Our main goal is to maintain production, ensure the payment of salaries to our 1,200 employees, and support the economy and the Armed Forces of Ukraine.

Between 2022 and 2024, we paid UAH 1.7 billion in taxes to the budget and received over €450 million in foreign currency revenue, which is a significant contribution to the Ukrainian economy.

Options for solving the VAT problem

The solution to the situation at our company is a temporary change in the structure of raw material procurement (until the situation is resolved at the state level).

At the state level, this would involve harmonizing the provisions of current Ukrainian legislation, in particular the provisions of the CMU Resolution “On Ensuring the Protection of National Interests in Future Lawsuits by the State of Ukraine in Connection with the Military Aggression of the Russian Federation” No. 187 of March 3, 2022 with the provisions of the Tax Code of Ukraine (in terms of the right to budgetary reimbursement of value added tax).