Ukraine’s spending on the development and procurement of weapons and military hardware in 2022 has been increased by UAH 67.57 billion with UK loans totaling 1.7 billion and aimed at bolstering capacities of the Ukrainian Navy.
The Ukrainian Verkhovna Rada adopted the respective bill by 342 votes on Tuesday.
The bill enlarges this year’s budget expenditures from UAH 1,525.930 trillion to UAH 1,593.5 trillion with the special fund’s growth to UAH 221.11 billion.
Meanwhile, the budget deficit ceiling was raised from UAH 188.8 billion to UAH 256.36 billion, including UAH 96.1 billion for the special fund.
In addition, the budget no longer has restrictions at the amount of 3% of the planned revenue for the provision of state guarantees, as well as restrictions at the amount of UAH 10 billion and UAH 20 billion, respectively, for the provision of portfolio guarantees and loan guarantees, in order to increase the national defense capacity.
The bill limits road fund expenditures. “The money will be primarily spent on repaying the state debt, defense, and the development and maintenance of roads,” the Servant of the People faction said in comment on the bill.
An explanatory note says that Ukraine will be implementing state investment projects to purchase two minesweepers from British suppliers, to deliver and service these minesweepers, to ensure the joint construction of eight missile craft, and to deliver and install weapons on the available ships. It is also planned to jointly build a frigate and to receive advisory and technical support for the construction of naval infrastructure, including the delivery of equipment.
At the end of January, the Verkhovna Rada ratified a framework intergovernmental agreement on loan funding of the development of the Ukrainian Navy. The agreement was signed in London on November 12, 2021, to envisage allocations for the construction of eight missile craft, the procurement of two minesweepers from the UK, and the opening of two naval bases in Ukraine.
Prime Minister of Ukraine Denys Shmyhal says that the new tax system will start working this week. “In close cooperation with the president, MPs, we will completely reform the economic model of Ukraine… Within a few hours after the laws come into force, the Cabinet of Ministers will adopt all the necessary by-laws to make the new tax system work this week,” Shmyhal said in his address Tuesday afternoon.
Thus, among the changes adopted by the Verkhovna Rada during martial law for medium and large businesses, the opportunity to use the single tax option will be significantly expanded.
In particular, enterprises with a turnover of up to UAH 10 billion will be able to switch to paying a social single tax, and all other restrictions on the number of workers and types of activities (except for excisable goods and gambling business) will be lifted.
Instead of VAT and income tax, entrepreneurs will pay only 2% of their turnover.
The draft law also contains many other positive innovations, including: individual entrepreneurs of the 1st and 2nd groups will pay a single tax on a voluntary basis, as well as individual entrepreneurs will not pay social single tax for their mobilized employees, as well as for martial law period individual entrepreneurs will not pay social single tax if they do not receive income.
In addition, the amendments provide that: sanctions for violation of the cash register law will not be applied until the end of martial law; from February 24 until the end of the year, payers on whose territories hostilities are being conducted are exempted from payment for land; VAT will not be paid for goods destroyed during the war, as well as for goods, transferred for defense needs; the excise tax on fuel will be abolished, and the VAT rate on these items will be reduced from 20% to 7%.
According to the prime minister, the government will make a decision today to ban inspections of businesses, except for those related to the safety and health of citizens.
“At the same time, the requirements for obtaining permits for a significant part of entrepreneurial activity will be abolished,” the prime minister said.
Turkish Foreign Minister Mevlut Cavusoglu will take part in talks in Moscow on Wednesday and will visit Ukraine on Thursday, Turkish President Recep Tayyip Erdogan said on Tuesday.
“Today, the Turkish Foreign Minister will leave for Moscow, where he will hold talks tomorrow, and on Thursday he will leave for Ukraine,” the Anadolu news agency quoted Erdogan as saying.
The approved fourth package of sanctions against Russia over the Ukraine situation was published in the Official Journal of the European Union and entered into force on Tuesday.
“This Decision shall enter into force on the date of its publication in the Official Journal of the European Union,” the journal said.
As previously reported, renewed EU sanctions on Russia include a ban on investment in Russia’s energy sector, but exceptions are made for the peaceful nuclear industry and transportation of energy resources to the EU.
President of Ukraine Volodymyr Zelensky has stated the need to find effective security guarantees for Ukraine that would not be in doubt.
“We need to look for effective guarantees. Guarantees for us, for our skies, and we will not abandon it. We need aircraft. I will continue to talk about this, I will continue to pursue this. We need long-term security guarantees for the state, for all Ukrainians, but concrete things, specific guarantees, legally binding, so that there is no doubt about them,” Zelensky said in a video message on Tuesday.
The G7 countries and the UN are ready to provide Ukraine with full support in increasing the export of Ukrainian agricultural products via new logistics routes, bypassing its ports blocked by the aggressor country of the Russian Federation, Minister of Agrarian Policy and Food of Ukraine Roman Leschenko said on his Telegram channel on Tuesday.
They are also ready to help in the sowing campaign, the supply of food and fuel, Leschenko wrote about the results of the online meeting of the ministers of agricultural policy of the G7 countries, the EU Commissioner for Agricultural Policy, as well as representatives of the UN World Food Program and the UN Food and Agriculture Organization.
“We discussed the situation with food and sowing in Ukraine. I am grateful to the partners for their sincere understanding and for their support in expanding the markets for Ukrainian agricultural products through new logistics routes, supporting fuel and lubricants in the sowing campaign in Ukraine and supplying food kits for Ukrainians into the war zone,” the minister said.
He said that the meeting participants expressed their full support for Ukraine in these issues, and expressed hope for a quick joint solution of all challenges facing Ukraine.
