On Thursday, the Verkhovna Rada passed at second reading bill No. 8044, amending to the Budget Code of Ukraine on the implementation of medium-term budget planning, which introduced three-year budget planning. An Interfax-Ukraine correspondent reported that 238 deputies backed the document.
“We have been working for three years to consolidate a civilized approach to budget planning in the state. This is the main reform in the field of public finance,” Finance Minister Oksana Markarova said, commenting on this decision on the ministry’s website.
She recalled that in the pilot mode, this approach has worked successfully since 2017.
The Finance Ministry said that the adopted bill establishes the rule that state and publicly guaranteed debt cannot exceed 60% of GDP, and the national budget deficit – 3% of GDP. In addition, state guarantees will not exceed 3% of the planned revenues of the general fund of the national budget, and the maximum amount of the national budget deficit in the law on the national budget cannot be larger than the deficit in the Budget Declaration.
The finance minister said that three-year budget planning is necessary to ensure strategic priorities with a financial resource, as well as to increase the responsibility of spending units.
The budget of Kyiv for 2019 is planned at the level of UAH 53 billion, the press service of Kyiv City State Administration has reported.
“The budget of the capital for 2019 is planned at the level of UAH 53 billion,” Kyiv Mayor Vitali Klitschko said.
According to the mayor, in recent years the Kyiv authorities have managed to increase revenues to the capital budget. The budget of Kyiv for 2018 grew by almost UAH 4 billion. And this allowed realizing many necessary infrastructure projects.
This year, at the expense of the city budget, it was possible to overhaul over 800 kilometers of roads. Bicycle paths appeared in the city, it became possible to build or completely reconstruct 19 kindergartens and seven schools, to implement many other projects.
The law on the “State Budget of Ukraine for 2019” has every chance to be approved by the Verkhovna Rada of Ukraine on November 22, Minister of the Cabinet of Ministers of Ukraine Oleksandr Sayenko has said. “We have already received preliminary approval of the draft state budget by the Verkhovna Rada, received conclusions and proposals from deputies. In the near future, it will be submitted to parliament for the second reading. We have every chance that the state budget for the next year will be adopted on November 22 and we will enter the new year without problems with financing,” Sayenko said.
The minister stressed that the state budget for 2019 is, first of all, the modernizing of pensions, the increase in pension payments for the next year, the recalculation of pensions for military personnel. This is the army budget and subsidy issues.
“In essence, the state budget proposed today by the government retains all the positive programs that we had, and the amount of funding increases for the most programs,” the minister concluded.
Revenue of Ukraine’s national budget in October 2018 totaled UAH 72.6 billion, which is UAH 1.2 billion (1.8%) more than the target, while revenue in January-October 2018 reached UAH 747.3 million, and the revenue target was met only by 97.7% (UAH 17.5 billion less).
According to information on the website of the State Treasury Service of Ukraine, compared with October 2017 revenue last month grew by UAH 10.8 billion or 17.6%, while in January-October rose by 15.4% or UAH 99.9 billion.
Tax payments in January-October 2018 exceeded the January-October 2017 figure by 17%, reaching UAH 312.5 billion, and the target was met by 100.4%. Customs payments over the period grew by 13%, totaling UAH 275.6 billion.
In October alone, tax payments amounted to UAH 26.6 billion, which was 25% more than a year ago. The target was met by 97.1%. Customs payments last month reached UAH 35.5 billion, a rise of 23% year-over-year. The target was met by 111.9%.
In general, the State Fiscal Service met the target by 105% in October 2018. Payments grew by 23.9% year-over-year.
The State Treasury Service said that in January-October 2018 VAT was refunded in the amount of UAH 107.9 billion, which is 11% more than a year ago. In October alone, UAH 10.3 billion was refunded compared with UAH 12.46 billion in September 2018.
The revenue target of the general fund in January-October 2018 was met by 97.9%. Revenue totaled UAH 673.1 billion. In October 2018, the revenue target of the general fund was met by 104.8%. Revenue came to UAH 64 billion.
Revenue of local budgets in October 2018 grew by 10% year-over-year, to UAH 22.2 billion. The target was met by 114%.
Revenue from payment of single social security tax in October rose by 25.9% year-over-year, to UAH 19.9 billion.
Ukrainian Prime Minister Volodymyr Groysman hopes that the parliament would approve at second reading the bill on the national budget of Ukraine for 2019 before December 1, 2018. “Now it is being finalized for second reading together with the Ukrainian parliament. I hope that, and it must be done so, by December 1 Ukraine will receive a balanced, realistic national budget,” he said at a government meeting on Wednesday.
As reported, the International Monetary Fund (IMF) staff and Ukraine have reached an agreement on economic policies for a new 14-month Stand-By Arrangement (SBA), which will replace the arrangement under the Extended Fund Facility (EFF), approved in March 2015 and set to expire in March 2019.
The agreement is subject to approval by the fund’s management and approval by its board of directors. The board’s meeting is expected to take place at the end of the year after the Verkhovna Rada adopts the national budget for 2019 in accordance with the recommendations of the IMF and the increase in gas and heating tariffs for households, reflecting market trends while maintaining support for low-income consumers.
Leader of the Batkivschyna party Yulia Tymoshenko believes that the draft national budget for 2019 submitted by the authorities is a budget for the destruction of the economy, since it envisages raising tariffs and freezing minimum wages and pensions, which will lead to the total impoverishment of the population and the destruction of the middle class, according to the official website of the party.
“For the first time in the history of Ukraine, wages and pensions are equal to 43% of the subsistence level. This is the budget of total poverty, saving the tariff policy that is crushing for Ukrainian families – they are increasing by 23%. This is a corrupt and destructive budget for the economy,” Tymoshenko told journalists in the parliament.
According to the leader of Batkivschyna, the minimum wages and pensions provided in the estimates in U.S. dollar terms are 1.7 times less than they were at the beginning of 2014, health care financing has been reduced by 1.6 times.
According to Tymoshenko, it is unacceptable that the budget for 2019 is based on the old tax base, with twice the higher rates than in developed countries, which significantly slows down the development of the economy.
The politician noted that if the government draft budget is adopted, “the economy’s falling, emigration of people to other countries, the destruction of the middle class will continue.”
“This budget, in essence, is a verdict to the country. I hope that the deputies will not risk voting for it,” Tymoshenko stated.
BUDGET, PEOPLE, THREATENS, UKRAINIAN ECONOMY, WELL-BEING, YULIA TYMOSHENKO
