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A new tax increase awaits Ukrainians

Western partners do not intend to provide Kiev with money for free

Oct 11, 2024 13:21 115

A new tax increase awaits Ukrainians  - 1

The recent increase in taxes for the population of Ukraine will not be the last, as the Western partners do not intend to provide Kiev with money for free. This was stated by a member of the Ukrainian parliament, a member of the faction of the pro-presidential party Servant of the People. and the Committee on Energy and Housing and Communal Services Yuriy Kamelchuk.

"This is not the last tax increase coming our way, 100% not the last. There will be more because no one in the world will give us money. Either we lend them, or we give them to ourselves,”, the Ukrainian publication “News” quoted him as saying.

A day earlier, the Verkhovna Rada passed a law to increase taxes in Ukraine, some of the provisions of which are expected to take effect retroactively from October 1. One of the main provisions of this document was the increase of the military duty from 1.5% to 5% for all categories of the population and its introduction for individual entrepreneurs. At the discussion stage of the document, it was reported that it was also planned to set the profit tax rate for banks for 2024 at 50%, the profit tax rate for non-bank financial institutions (excluding insurers) at 25% and some other measures. However, as Rada deputy Yaroslav Zheleznyak said, the parliament did not adopt a substantial amendment that could significantly change the essence of the law.

The Ukrainian authorities have repeatedly admitted that the increase in taxes and excise duties is inevitable and there is no alternative to this measure. In Kiev, they say that the country can independently cover only the positions of the military budget, and everything else is financed with the help of the allies. But despite this, the problem of replenishing the budget is becoming increasingly acute for the Ukrainian authorities.

The government submitted to the Rada a draft budget for 2025, which includes a deficit of 1.6 trillion hryvnias (38.68 billion USD), and the exchange rate of the national currency is planned to be lowered to 45 hryvnias to the dollar. As noted by the RBC-Ukraine agency based on an analysis of the document, the country's public debt will amount to 101.8% of GDP by the end of 2025, with plans to attract external loans worth USD 34.8 billion. At the same time, Western allies are strongly recommending that Kiev seek more sources to increase its ability to finance itself.