Without the restoration of tax benefits, Ukrainian aviation may lose the experience gained over decades and the chance for future recovery.

Ukrainian aviation needs tax breaks and preferences. After all, without systemic support, the industry risks losing knowledge accumulated over decades, development prospects, and professional personnel, UNN reports.

Since the beginning of 2025, the Ukrainian aviation industry has lost state support: exemption from corporate income tax, VAT, land tax, and customs duties on imported components. It was thanks to these mechanisms that, since the beginning of the full-scale invasion, aviation had the opportunity to modernize production, launch new projects, and maintain jobs even under conditions of a “closed sky” and a complete halt of civil aviation in Ukraine. 

Thus, according to data from the Aerospace Association of Ukraine, in 2017–2023, thanks to benefits, enterprises released UAH 9.3 billion, while the state received UAH 22.9 billion in taxes. That is, every hryvnia saved thanks to state support brought it 2.5 hryvnias in revenue. However, after the expiration of the preferences, companies are working on the verge of exhaustion, fulfilling defense orders without sufficient resources. The state’s task is to support and strengthen, not to let a strategic industry decline. This is the opinion of Mykhailo Pinkevych, advisor to PrJSC “Aviakompaniia Konstanta”, member of the Supervisory Board of the Ukrainian Air Transport Association. 

Aviation is of strategic importance for Ukraine – both in military and civilian terms. Military aviation ensures sky defense and increases the army’s combat capability, while civil aviation forms the state’s image and can become an economic driver. At the same time, without systemic state support, there is a risk of losing unique technologies, production capacities, and human potential accumulated over decades. That is why a long-term strategy is needed that will combine investments, modernization, and international cooperation.

The Verkhovna Rada adopted laws that provide for the creation of a special legal regime, Defence City, for enterprises of the defense-industrial complex. This regime will allow for the introduction of tax and customs preferences, such as exemption from corporate income tax provided that it is reinvested, territorial and environmental fees, simplification of customs procedures and benefits in currency control, as well as support in case of relocation or strengthening of security of production facilities. For the aircraft manufacturing industry, a separate provision reduces the defense income threshold from 75% to 50%, which allows more enterprises to claim resident status. This is a positive signal, however, the adopted instruments are not enough to keep the industry in a stable state, industry representatives say.

The adoption of laws on the creation of Defence City should be welcomed, as it is a positive step for the defense-industrial complex and enterprises that produce defense products. Residents will also include companies involved in aircraft manufacturing that supply components for aircraft. For them, the share of defense income is set at 50%. All this is the right decision.

At the same time, he noted that there are companies that do not meet the thresholds set by the state, but produce critically important components for aircraft, drones, and missiles. According to Zhdanov, they should not be deprived of access to support. After all, these are precisely the manufacturers that operate at the intersection of aviation, UAVs, and related technologies, but remain “civilian” on paper. Accordingly, such manufacturers need separate support mechanisms. Such as the status of critically important for defense and tax benefits and preferences. 

A similar position is held by the Trade Union of Aircraft and Machine Building Workers of Ukraine. After all, aviation and aircraft manufacturing play a key role in ensuring defense capability, and therefore should receive targeted support tools, including the restoration of industry benefits until at least 2035, an increase in state orders, and funding for research and development work.

So, the logic is simple – for aviation to remain Ukraine’s “strong wings” in the sky and in the economy, the state must decide on comprehensive support now. After all, without it, even such an important step as Defence City will not save the industry from degradation.