Tax and accounting insights for Ukraine
20.06.24
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Hetmantsev on tax increases: We expect "radical" proposals of the Cabinet of Ministers

The Finance Committee of the Verkhovna Rada expects the Cabinet of Ministers to submit proposals on the rates of certain taxes in order to fill the budget in the near future. Danylo Hetmantsev, chairman of the Verkhovna Rada Committee on Finance, Taxation and Customs Policy, told reporters on the sidelines of the Verkhovna Rada, Ukrinform reports.

"We have heard repeatedly from the Ministers of Finance and Defense about the significant underfunding of military spending in the budget, which is measured in hundreds of billions of hryvnias. This is so much money that it cannot be accumulated only by some point solutions or through de-shadowing," Hetmantsev said.

In addition, he said, the resources from unshadowing are already being used, which contributed to the overfulfillment of budget targets.

"But the budget is not comparable to the existing needs. Therefore, in the near future we expect proposals from the Cabinet of Ministers on how to cover defense spending. I don't know what kind of taxes the Cabinet will propose. However, given theseriousness of the situation, I expect the proposals to be quite radical," the Committee Chairman said.

Earlier, Hetmantsev noted that the main sources of budget revenues are personal income tax, military duty, value added tax and excise taxes.

According to his assumptions, the income tax is unlikely to be changed due to certain peculiarities of its administration that do not allow for quick collection of money. In particular, it is difficult to quickly accumulate funds from the CPT to the state budget due to the annual tax period. There are no such problems with VAT, military duty and excise taxes. Therefore, we are talking about raising the rates of these taxes and fees.

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