Ukraine's parliament votes to reinstate pre-war tax levels from August

Ukraine's parliament voted on Friday to return tax rates from the start of August to levels they were at before Russia's invasion, a move aimed at boosting budget revenues and complying with an International Monetary Fund lending program. Scrapping tax privileges and boosting budget revenues are key conditions under IMF's $15.6 billion lending program. ($1 = 36.9300 hryvnias)

Ukraine's parliament voted on Friday to return tax rates from the start of August to levels they were at before Russia's invasion, a move aimed at boosting budget revenues and complying with an International Monetary Fund lending program. Lawmaker Yaroslav Zheleznyak said deputies had voted to support legislation that would scrap a 2% unified tax for hundreds of small and medium-sized entrepreneurs, increasing the rates.

The government introduced tax cuts and other economic measures soon after Russia's Feb. 24, 2022 invasion to help businesses weather the disruption caused by the war. "After long discussions, parliament supported the tax draft law as a whole. The adoption of this law is an important condition envisaged by the agreement with the IMF," Zheleznyak said on the Telegram messaging app.

Finance Minister Serhiy Marchenko told Reuters in an interview this month that the move would generate extra government income of up to 10 billion hryvnias ($271 million) for the remainder of 2023. Ukraine depends heavily on foreign aid to finance its budget spending this year as the war hit the economy severely. Scrapping tax privileges and boosting budget revenues are key conditions under IMF's $15.6 billion lending program.

($1 = 36.9300 hryvnias)