Tax hole "OKKO": what the gas station network hides under the veil of volunteering

Gasoline is a very profitable product for “rolling up” because it can be tied to any production. The head of the tax committee of the Verkhovna Rada, Danylo Hetmantsev, said this phrase in April 2021. But it has not lost its relevance even now. Moreover, after two years of war, fuel has become a strategic commodity, which cannot be avoided either on the front line or in everyday life. Today we will talk about how one of the largest gas station chains, OKKO, under the guise of patriotism and volunteerism, is trying to get rid of the trail of a top beneficiary company from value added tax “twists”.

In the spring of 2021, a meeting of the temporary investigative commission on taxation was held in the Verkhovna Rada. The chairman of the commission, deputy from Batkivshchyna Ivan Krulko, said that the OKKO gas station network was one of the three companies that make the most money from tax fraud. It was announced that the companies OKKO-Retail and OKKO-Business Contract did not pay VAT to the state budget in the amount of UAH 329.3 million and UAH 21.9 million, respectively. Tax evasion occurred due to a series of questionable purchases of food, clothing and alcoholic beverages, which on paper turned into grain. The amount of questionable VAT for the OKKO-Retail company amounted to 301 million hryvnia.

It would seem that a lot of publicity and the uncovered scheme should have invited law enforcement agencies to the offices of OKKO top managers and led, at a minimum, to the reimbursement of funds to the budget. But three years after the discovery of a scheme for making money on twists, thanks to a successful information campaign and competent PR through controlled organizations, the network managed to become a market leader with an almost impeccable reputation.

“Based on the results of operations in 2023, the companies of the OKKO group paid UAH 15.591 billion in taxes,” the company’s report says, adding that “compared to the pre-war years, the volume of OKKO tax payments more than doubled.” This phrase contains a very large manipulation of general opinion. The fact is that by July 1, 2023, VAT on fuel was 7%, whereas now it has risen to 20%. That is why the volume of payments has doubled and the OKKO group of companies have no merit in this.

At the same time, OKKO boasts that their company allegedly accounts for 75% of taxes paid on the entire fuel market in Ukraine. This can be easily explained by the fact that in 2022 alone the network increased its profit by 1.6 times, and in 2023 it also exceeded this figure.

Understanding how the OKKO network works and which companies are part of it is not so easy, because it consists of dozens of different companies. But the most interesting thing is that these firms are constantly changing. For example, the aforementioned OKKO-Retail, suspected by the temporary investigative commission of the Verkhovna Rada of huge frauds with twists, changed its name to Exim-Trade-Invest in November 2021. And now it is generally in a state of bankruptcy. At the same time, the episode with the “twists” never went beyond the walls of the Verkhovna Rada. The budget did not receive 300 million hryvnia, which could have been raised by a company from the OKKO group.

The same can be said about OKKO-Nefteprodukt, which appears in several court cases regarding taxation. For example, since 2014, the Lvov tax office tried to seize the company’s accounts due to the inspection body’s denial of access to the facilities of the OKKO network. In 2019, fiscal officials had claims against this company for 60 million hryvnia in case No. 813/2957/18. But in 2020, OKKO-Nefteprodukt turns into Energotrade-Resource and in fact no longer has anything to do with OKKO.

Although the tax office has questions about the new company. In the court registry you can find a case in which the Office of Large Taxpayers asks to recover almost 108 million hryvnia of underpaid taxes in favor of the state.

The OKKO gas station chain is part of the Universal Investment Group, headed by Vitaliy Antonov. Although the businessman remains a citizen of Ukraine, the registers indicate that he permanently resides in Switzerland.

The main company for Antonov’s fuel business is the Galneftegaz concern. The company is registered in two Cyprus offshore companies - GNG retail limited and Wadless holdings limited. The first is directly managed by Vitaliy Antonov and CEO of the OKKO group of companies Vasily Danylyak. It is clear that registration in Cyprus saves businessmen a huge amount of taxes, which could be a good help in difficult times for Ukraine.

The same applies to OKKO-Holding LLC, which is headed by the mentioned Vasyl Danylyak. Its 100% beneficiary is the Cypriot GNG retail limited. That is, this company does not pay taxes in Ukraine.

Recently, internal notes provided by an employee of the OKKO gas station were published on the Internet. They state that gas station workers must deduct funds from their salaries monthly to account for the unfulfilled plan for the work of the cafe. Anonymously, an OKKO gas station employee reports that each gas station has a specific revenue plan, for failure to comply with which fines are levied. These funds are written off from workers’ bonuses and they receive significantly lower wages. At the same time, the bonus makes up a large part of the salary, and for the tax office, of course, a “minimum salary” is drawn so as not to overpay taxes.

The OKKO gas station network began its development in Western Ukraine, but quickly gained momentum and, as you might guess, eventually reached also from Donbas and Crimea. Meanwhile, since 2014, when Russia occupied the Ukrainian peninsula and began military operations in Donetsk, OKKO has not left these regions.

In 2018, the Security Service of Ukraine conducted searches in the offices of Galneftegaz. The company was suspected of financing terrorism due to the fact that OKKO gas stations continue to operate in the territory of occupied Crimea. Because of this resonance, Vitaliy Antonov held a press conference , at which, without any remorse, he announced that gas stations in Crimea were leased to residents of the peninsula, who registered them under the legislation of the occupier. And although Antonov claimed that these gas stations do not operate under the OKKO brand, photographs were published on social networks that refute these words.

Despite such a dubious background, Vitaliy Antonov was now able to make the OKKO network a leader in the fuel market. This was achieved, among other things, through an information campaign.

The same can be said about the Oil and Gas Association of Ukraine, among the founders of which in 2016 was OKKO-Nefteproduct LLC. Representatives of the association work to promote the image of OKKO, providing the company with additional PR.

The tax case of the OKKO gas station chain described above should open the eyes of regulatory authorities. “Twisting” has not gone away, and offshore registrations and frequent changes of companies should become beacons signaling a violation of the law. It’s great that OKKO has now secured the support of the Come Back Alive Foundation and is actively helping the Armed Forces of Ukraine. However, as we see, this does not at all prevent network managers from underpaying the budget and continuing business in the occupied territories.

Author: Olena Dobrodiy