Application of the Principle of Non Reformatio in Peius to Appeals of Decisions in the Field of Tax Offences

The existence of specific principles for appealing decisions in the field of tax offenses forms the basis for a comprehensive understanding of the parameters within which the legal mechanism for protecting taxpayers’ rights operates.Within the procedures for appealing decisions in the field of tax offenses, it is particularly relevant to introduce a legal mechanism that that effectively prevents the deterioration of the taxpayer’s legal position.The need for such safeguards arises from the current Ukrainian tax legislation, which grants the supervisory authority discretionary power to increase the taxpayer’s monetary obligation during an administrative appeal—potentially placing the taxpayer in a worse position than before filing the complaint.One such safeguard could be the incorporation of the principle of non reformatio in peius into tax legislation, which prohibits worsening the applicant’s situation compared to that established by the contested decision.The principle of non reformatio in peius should be applied in conjunction with the rule tantum devolutum quantum appellatum (the scope of review is limited to the scope of the appeal).In general, the legislator considered the principle of prohibiting the worsening of the taxpayer’s situation when adopting the Law of Ukraine “On Administrative Procedure.” Although the law does not explicitly mention this principle, it also does not permit the opposite—that is, it does not authorize the decision-maker to increase the negative consequences for the complainant. However, the primary issue for taxpayers is the failure to harmonize tax legislationwith the provisions of the Law of Ukraine “On Administrative Procedure.”As a result, the current tax legislation’s grant of discretionary power to increase monetary obligations places taxpayers in a vulnerable position: by appealing to a higher authority, they risk ending up in a worse situation than they were in at the time of filing the complaint.Incorporating the principle of non reformatio in peius into tax legislation would protect taxpayers from receiving less favorable outcomes when appealing decisions in the field of tax offenses.