President Volodymyr Zelenskyy has submitted a draft law to the Verkhovna Rada to ratify the €90 billion loan agreement with the European Union. The document envisages tax changes, including the abolition of benefits for international parcels and reform of the simplified taxation system. The draft law is scheduled to be considered today.
Briefly about the main points
- Zelenskyy submits bill to the Verkhovna Rada to ratify €90bn loan agreement with the EU
- Ukraine undertakes to cancel tax exemptions for international parcels
- Differentiated rates for the 3rd group of individual entrepreneurs and restrictions on repeated transition to the simplified taxation system are introduced
- The goal of the changes is to attract additional UAH 70 billion to the budget annually
Basics of the EU-Ukraine loan agreement
President Volodymyr Zelenskyy submitted a draft law on ratification to the Verkhovna Rada loan agreement with the European Union in the amount of EUR 90 billion. This loan is intended to support Ukraine's economy and ensure financial stability in a difficult time. The document provides for a number of commitments on the part of Ukraine related to tax reform.
Tax liabilities for obtaining financing
For the next tranche of the loan, Ukraine should abolish the following exemptions taxation of international parcels. The draft law also provides for reform of the simplified taxation system, including the introduction of differentiated rates for the third group of individual entrepreneurs. It also prohibits repeated switching to the simplified taxation system and eliminates schemes for artificially splitting businesses. These measures are expected to bring additional UAH 70 billion a year to the state budget.
The importance of tax reforms for the budget
The introduction of new taxation rules should increase budget revenues, which is key to supporting public spending in the war and post-war period. Attracting an additional UAH 70 billion creates opportunities to improve the quality of public services and invest in critical sectors of the economy.
Review process and next steps
The draft law will be considered by the Verkhovna Rada today. The ratification of the agreement will pave the way for further tranches of the EU loan, which is critical for financial support to Ukraine. At the same time, the fulfilment of tax obligations will be a test of the state's ability to implement deep economic reforms in a difficult environment.
