The Post-Soviet Potemkin Village

I am reading a book "The Post-Soviet Potemkin Village: Politics and Property Rights in the Black Earth" that is about land reform politics in Russia and Ukraine. It is written by Jessica Allina-Pisano, an Associate Professor in the School of Political Studies at the University of Ottawa. Professor Allina-Pisano conducted more than 300 interviews in Ukraine and Russia between 1997 and 2006. So far I just read two chapters that showed her profound knowledge of the politics in Ukraine and Russia. Her research is very interesting and I look forward to reading her book.

Ukraine’s Fiscal Policy Hurts National Exporters

Ukraine's fiscal policy forces the national exporters to a bankruptcy. A large number of export-oriented companies complain that the state refused to issue VAT (value-added tax) refunds because of exponentially increasing foreign and national debts. In Ukraine the Commerce Code and the Tax Code clearly state that the exporting companies should receive VAT refunds to avoid a double taxation because their products are subject to VAT in the importing countries. The state, however, issues tax refunds only to few companies that supported President Yanukovich in the 2010 Presidential elections. Other companies have to pay a high price for their political views. One of the largest steel-exporters, Arcelor Mittal, plans to lay off thousands of workers if the company does not receive VAT refund in the amount of $312 million (2.5 billion UAH). A transnational agro-producing corporation, Cargill, left the Ukrainian grain market because the government refused to reimburse VAT in the amount of $100 million (800 million UAH). Other exporters also face potential downsizing if the state defaults on VAT liabilities.