In accordance with the Agreement between the Government of Ukraine and the North Atlantic Treaty Organization on the Status of the NATO Delegation to Ukraine of 22 September 2015, ratified by the Law of Ukraine No. 989–VIII of 4 February 2016 (hereinafter referred to as the NATO Agreement), NATO funds projects including scientific institutions. So, according to paragraph «e» st. 1 of the Agreement, «NATO-funded project» means any project or activity, including, but not limited to, scientific, civil society, technical assistance, or NATO-funded research projects, or under the Program «Science for Peace and Security», a trust fund or otherwise; and according to the norms of paragraph «f» st 1 of the Agreement, «recipient» means any legal or natural person located or resident in Ukraine who receives funds and/or equipment under a NATO-funded project.

The procedure for registration of international scientific and technical programs and projects implemented in the framework of international scientific and technical cooperation by Ukrainian scientists, as well as grants provided in the framework of such cooperation, approved by the order of the Ministry of Education and Science of Ukraine dated 20.11.2017 No. 1507.

At the moment, according to the rules of paragraph 197.11 of the TCU are exempt from VAT, including transactions with:

• supply of goods and services in the customs territory of Ukraine and importation into the customs territory of Ukraine of goods as international technical assistance provided in accordance with international treaties of Ukraine, consent to the binding nature of which is provided in the manner prescribed by law;
• supply of goods and services in the customs territory of Ukraine and importation into the customs territory of Ukraine of goods financed by international technical assistance provided in accordance with international treaties of Ukraine, consent to be bound in the manner prescribed by law.

Paragraph 197.11 of the TCU does not specify which document regulates the procedure for providing international technical assistance. In addition, this norm does not refer to the fact that the procedure for attracting, using and monitoring international technical assistance for the purposes of applying this norm is established by the Cabinet of Ministers of Ukraine.

Meanwhile, the tax authorities refer to the document regulating the procedure for providing international technical assistance in accordance with paragraph 197.11 of the TCU, only the Procedure for attracting, using and monitoring international technical assistance, approved by the Cabinet of Ministers of 15.02.2002 No. 153. This approach is implemented in the Handbook N 103/2 other tax benefits as of 09.04.2021, where in the description of the benefit under code 14060528 «NATO-funded projects, including their assets, income and other property (owned by the recipient or another person on behalf of the recipient) are exempt from all direct and indirect taxes, however, neither NATO nor the recipient will claim exemption from taxes and payments related to the payment of utilities sources inside and outside Ukraine for a NATO-funded project. Such contracts, goods, services and construction are not subject to duties, taxes, value added and other payments in Ukraine. Goods, services and construction acquired in accordance with this provision shall not be alienated by sale or gift in Ukraine, except for the conditions approved by the Government of Ukraine only reference to the Law of Ukraine «On Ratification of the Agreement between the Government of Ukraine and the North Atlantic Treaty Organization NATO Representation in Ukraine» (Articles 25, 26 of the Agreement) and paragraph 3.2, Article 3 of Section I of the TCU.