Editor’s Note: This is the 77th issue of Ukrainian legislator Yaroslav Zelezniak’s weekly “Ukrainian Economy in Brief”, covering events between Oct. 7 and Oct. 13, 2024. The digest highlights the steps taken by the Ukrainian parliament in relation to business, economy, and international financial programmes.
The Kyiv Independent republishes with permission.
The memorandum of understanding with the IMF includes benchmarks and soft commitments
The final reading of the draft law on tax increases was adopted by the parliament.
The Verkhovna Rada (Ukraine‘s Parliament) adopted in final reading on October 10 the draft law #11416 d to increase taxes.
During the voting, however, a key amendment that included all major suggestions made by the Tax Committee was rejected. In particular, the rule that allows the draft law to be retroactively effective from October 1. It appears, for example, that the increase in military levy won’t be applied until after the draft law has been signed and published. This will reduce expected revenues.
The draft law also includes a 50% windfall tax on banks in 2024, although the NBU and the Finance Ministry opposed this.
During the revision of the law, the lawmakers lowered the burden by reducing the military levy to 1.5% for those who serve in the military.
The draft law is expected, in total, to generate additional budget revenues of Hr 25-30 billion (600-700 millions) this year and Hr150-160 billion (3.6-$3.9 million) by 2025.
After the adoption of the decision, some lawmakers submitted 13 resolutions in order to annul the decision of parliament. On Oct. 14, however, the Rada rejected the resolutions and allowed the speaker to sign. The draft law has already been sent to the President’s Office for signature.
Obligations of the EU
The Parliament adopted the draft law necessary to fulfill the obligation of increasing the number HACC members.
The Verkhovna Rada approved in final reading the draft law #11426 that extends the mandate of the Public Council of International Experts, which will certify candidates for the High Anti-Corruption Court. The PCIE expires in October 2024 and more time is required to complete the ongoing selection of new HACC Judges.
The adoption of this draft law will implement the EU recommendations and soft commitments made to the IMF. It will also be a necessary step to enable Ukraine to fulfill its obligations under the Ukraine Facility, which is to increase the HACC members. (The deadline for this is the first quarter of 2025).
The Ukrainian Plan required that two draft laws be considered by the Parliament.
The Verkhovna Rada has adopted in final reading the draft law #11310 concerning the basic principles of climate policy, which is one of obligations under the Ukraine Facility Financial Mechanism.
The Parliament also adopted in first reading the revised draft law #12039 on plea agreements, which was re-submitted. The new draft received the support of SAPO and NABU.
The new provisions in the draft law allow a shorter sentence than is currently required for cooperation with an investigation, through the exposure of accomplices or compensation for damages. Five years instead of eight. The court can also impose a fine of up to Hr102 million ($2.4m) and confiscate property. This mechanism cannot be applied to all organizers of corrupt schemes. It can only be used in cases where an organizer has exposed another organizer.
Other important issues
Ukrainska Pravda reveals systematic pressure by the Presidential Office.
Last week, Ukrainska Pravda, one of the most important independent Ukrainian media outlets, released an official press release to report on the ongoing and systemic pressure of the Presidential Office against the editorial team and certain Ukrainska Pravda journalists.
The media have accused the office, in particular, of blocking officials’ communication with Ukrainska Pravda reporters and preventing them from participating in events. They also accuse the office of putting pressure on businesses not to advertise with Ukrainska Pravda and for a public press conference between President Volodymyr Zelensky (left) and Ukrainska Pravda Journalist Roman Kravets (right).
Yaroslav Zelezniak, the first deputy chairman of Ukraine’s Parliamentary Committee on Finance, Tax, and Customs Policy, is a member of the Ukrainian Parliamentary Committee on Finance, Tax, and Customs Policy. He is also co-chairman of the Ukrainian Chapter for the Parliamentary Networks of the World Bank, International Monetary Fund and the World Bank.
Read More @ kyivindependent.com