Ukrainian legislators pass 'unpopular' tax increase
Ukraine's budget for 2025 is projected to experience a significant shortfall amounting to several billion dollars, even with the support of foreign aid. Read Full Article at RT.com
TroibNews 
The 2025 state budget is facing a substantial multi-billion-dollar shortfall, even with the support of foreign aid.
In response to the growing budget deficit, Ukraine's parliament has enacted its first significant tax increase since the beginning of the conflict with Russia in 2022. The lower house approved the draft law on Thursday, which has been met with intense criticism from both the opposition and the public. This legislation seeks to raise the war tax levied on residents from 1.5% to 5%, implement a 50% tax rate on bank profits, and impose a 25% tax on financial companies, among other provisions.
The Finance Ministry indicated that the new taxes are projected to contribute approximately $563 million to the national budget this year, with expectations of around $3 billion for the following year.
In August, Prime Minister Denis Shmygal stated that Ukraine required an additional $15 billion to address its budget deficit, which is anticipated to hit $35 billion in the next fiscal year. He further noted that Kyiv is looking to secure $20 billion from the European Union and the International Monetary Fund in 2025.
Describing the tax increase as a “historic tax increase,” Yaroslav Zhelezniak, deputy chair of the parliamentary committee on finance and tax policy, expressed support for the measures. However, opposition lawmakers denounced the decision as “shameful.” Aleksey Movchan, a member of President Zelensky's party, recognized the unpopularity of the bill, stating that legislators would be “hated” for their vote in favor of it.
Several residents of Kyiv voiced their disdain for the tax rise, as reported by the New York Times. One store worker lamented, “We’ve all been struggling financially for a long time, and now we’ll lose even more of our salaries and income. There’s a lot of concern and dissatisfaction.”
Additionally, there is widespread apprehension that the funds raised through these new taxes may be misappropriated by corrupt officials, particularly given the recent high-profile corruption scandals that have plagued the nation. Solomiia Bobrovska, an opposition lawmaker and member of the parliamentary defense and intelligence committee, articulated this distrust, stating, “There is no trust that the state will properly use the money.”
An advisor to President Zelensky, speaking under anonymity to Time magazine last October, noted, “people in Ukraine are stealing like there’s no tomorrow.”
In contrast, Foreign Minister Dmitry Kuleba has dismissed claims of rampant corruption as false.
Ramin Sohrabi contributed to this report for TROIB News
In response to the growing budget deficit, Ukraine's parliament has enacted its first significant tax increase since the beginning of the conflict with Russia in 2022. The lower house approved the draft law on Thursday, which has been met with intense criticism from both the opposition and the public. This legislation seeks to raise the war tax levied on residents from 1.5% to 5%, implement a 50% tax rate on bank profits, and impose a 25% tax on financial companies, among other provisions.
The Finance Ministry indicated that the new taxes are projected to contribute approximately $563 million to the national budget this year, with expectations of around $3 billion for the following year.
In August, Prime Minister Denis Shmygal stated that Ukraine required an additional $15 billion to address its budget deficit, which is anticipated to hit $35 billion in the next fiscal year. He further noted that Kyiv is looking to secure $20 billion from the European Union and the International Monetary Fund in 2025.
Describing the tax increase as a “historic tax increase,” Yaroslav Zhelezniak, deputy chair of the parliamentary committee on finance and tax policy, expressed support for the measures. However, opposition lawmakers denounced the decision as “shameful.” Aleksey Movchan, a member of President Zelensky's party, recognized the unpopularity of the bill, stating that legislators would be “hated” for their vote in favor of it.
Several residents of Kyiv voiced their disdain for the tax rise, as reported by the New York Times. One store worker lamented, “We’ve all been struggling financially for a long time, and now we’ll lose even more of our salaries and income. There’s a lot of concern and dissatisfaction.”
Additionally, there is widespread apprehension that the funds raised through these new taxes may be misappropriated by corrupt officials, particularly given the recent high-profile corruption scandals that have plagued the nation. Solomiia Bobrovska, an opposition lawmaker and member of the parliamentary defense and intelligence committee, articulated this distrust, stating, “There is no trust that the state will properly use the money.”
An advisor to President Zelensky, speaking under anonymity to Time magazine last October, noted, “people in Ukraine are stealing like there’s no tomorrow.”
In contrast, Foreign Minister Dmitry Kuleba has dismissed claims of rampant corruption as false.
Ramin Sohrabi contributed to this report for TROIB News
