The amount of income tax and dividends for 2023 that state-owned PrivatBank (Kyiv) transferred to the state budget amounted to almost UAH 50 billion, Yulia Metzger, a member of the bank’s Supervisory Board, said at the International Financial Club BANKIR conference.
“Already in February this year, the Supervisory Board decided that the bank had transferred to the budget an advance payment of dividends and income tax based on the results of the previous year in the amount of almost UAH 50 billion,” she said.
According to the NBU, PrivatBank’s pre-tax profit for 2023 amounted to UAH 72.77 billion, and income tax expenses amounted to UAH 35 billion. According to the government’s decision, 80% (UAH 30.2 billion) of the remaining net profit of UAH 37.76 billion should be used to pay dividends.
As reported, on February 12, Privat transferred the amount of income tax and the first tranche of dividends for 2023 in the amount of UAH 26 billion to the state budget in advance.
PrivatBank is the largest bank in the country, with total assets of UAH 848.64 billion as of March 1, 2024, or 25.9% of the assets of all 63 banks.
Metinvest Mining and Metallurgical Group, including its associates and joint ventures, increased its payments of taxes and duties to the budgets of all levels in Ukraine by 1.7 times year-on-year to UAH 4.2 billion in January-March this year.
According to the company’s press release on Monday, the largest deductions include subsoil use fees, which increased 7.5 times year-on-year to UAH 1.3 billion compared to Q1 2023. The Group also increased its personal income tax payments by 22% to UAH 791 million. In addition, Metinvest transferred UAH 870 million of unified social tax to the budget, which is 20% higher than in Q1 2023.
At the same time, Metinvest’s Ukrainian enterprises paid UAH 407 million in income tax in January-March 2024. Land payments increased by 8% year-on-year to UAH 312 million, and environmental tax by 34% to UAH 182 million.
Yuriy Ryzhenkov, CEO of Metinvest, noted that despite the war in Ukraine and many unfavorable business factors, the Group managed to achieve positive dynamics in payments.
“This is the result of our team’s efforts to improve efficiency in all areas and to adjust the company to the new environment. As the largest taxpayer in the industry, we realize that the economy of the frontline regions and the entire country, as well as the ability to support the army and Ukrainians, depend on our stable operation. And we will do everything to continue to overcome all the challenges of wartime on the way to victory,” the top manager emphasized.
As reported, in 2023, Metinvest paid UAH 14.6 billion in taxes to the Ukrainian budget.
“Metinvest is a vertically integrated group of steel and mining companies. The Group’s enterprises are mainly located in Donetsk, Luhansk, Zaporizhzhia and Dnipropetrovs’k regions.
The main shareholders of the holding are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage it.
Metinvest Holding LLC is the management company of Metinvest Group.
Zaporozhkoks, one of Ukraine’s largest coke and chemical producers and a member of Metinvest Group, despite the difficulties caused by Russia’s military aggression, paid over UAH 225 million in taxes and fees to the budgets of all levels in 2023.
According to the company, the average number of employees at the company is about 800, with almost 14% of employees mobilized into the Armed Forces of Ukraine. Since the beginning of the full-scale invasion, eight Zaporozhkoks employees have given their lives for the freedom of Ukraine.
“Despite the full-scale war, Zaporozhkoks has been operating steadily, supporting the economy of our country and hometown. In 2023 alone, the plant produced about 1 million tons of gross coke, which is almost 30% of the total produced in Ukraine,” said Alexander Bekhter, CEO of the plant, as quoted by the press service.
It is also stated that over its 90-year history, Zaporizhkoks has produced almost 120 million tons of gross coke. The company is systematically upgrading its production facilities, including coke oven batteries, improving the quality and expanding the range of chemical products.
In particular, in 2019, a new electrode pitch granulation line was put into operation. In 2020, Zaporozhkoks put into pilot operation a new mini-cooling tower for cooling process water at the tar distillation shop. The company is successfully implementing energy saving projects, including a project to exchange secondary gases with Zaporizhstal.
As reported, Zaporozhkoks increased its blast furnace coke production by 16% in 2023 compared to 2022, up to 856.8 thousand tons from 737.4 thousand tons.
“Zaporozhkoks produces about 10% of coke in Ukraine and has a full technological cycle of coke products processing. It also produces coke oven gas and pitch coke.
“Metinvest is a vertically integrated mining group of companies. Its major shareholders are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage the company.
Metinvest Holding LLC is the management company of Metinvest Group.
Ukrzaliznytsia (UZ) will not receive funding from the state budget in 2024; at the same time, in 2023, it decreased by 2.4 times compared to 2022, to UAH 4.179 billion, according to a presentation made by Yevhen Lyashchenko, chairman of the board of UZ, during a conversation with journalists.
In 2022, UAH 10.095 billion was allocated from the state budget for UZ. The funds were allocated for the uninterrupted operation of rail transport under martial law, as well as for emergency repair work at railway infrastructure facilities, repair of traction and rolling stock, and payment of wages, UZ said.
In addition, the funds allocated from the state budget financed the design and implementation of work to restore the European standard 1435 mm railway track from Chop station to Uzhhorod station with the extension to the platform of Uzhhorod railway station. UAH 6 million was allocated for these purposes. Almost UAH 83 million was used as a postpaid payment for a batch of passenger railcars delivered under the contract signed in 2021.
Of the UAH 4.179 billion received from the state budget in 2023, UAH 1.905 billion was an advance payment for passenger railcars under the 2023 supply contract, UAH 1.736 billion was a postpayment for passenger railcars under the 2021 supply contract, and UAH 538 million was used to finance infrastructure projects.
In addition, part of the funds was allocated for the reconstruction of facilities with electrification of the Vasylkiv – Vasylkiv II, Cherkasy – Taras Shevchenko section; reconstruction of facilities with electrification of the Vasylkiv – Vasylkiv II. Taras Shevchenko; reconstruction of the railway track on the section Goskordor – Mostyska II – Sknyliv (Lviv) with the construction of a new terminal at Sknyliv station; construction of a railway road bridge over the Dnipro in Kyiv (with approaches) on the railway section Kyiv-Moskovsky – Darnytsia.
Metinvest Mining and Metallurgical Group is expected to increase its payments to budgets of all levels by 60% year-on-year to over UAH 4 billion from UAH 2.5 billion in January-March this year.
Metinvest’s CFO Yulia Dankova told dsnews.ua that the dynamics of payments is positive, although it is negative compared to the first quarter of 2022, when the company paid UAH 6.9 billion in taxes, but this accrual was based on the results of the pre-war fourth quarter of 2021.
At the same time, she clarified that, in particular, the group’s enterprises in Pokrovsk, located a few tens of kilometers from the front line, paid more than UAH 261 million in taxes and fees in 2023, which is a third of all tax revenues to the local budget. The largest items of deductions are personal income tax in the amount of over UAH 245 million, rent for subsoil use – UAH 8.5 million, property tax – UAH 4.5 million, land payment – over UAH 3 million, and environmental tax – over UAH 2.3 million.
“We believe that this is a significant contribution to the development of local communities and support of the country’s defense capability in general,” said the CFO.
Answering the question about the need to improve tax legislation to enable businesses to operate more efficiently in the war, Dankova explained that Ukraine is still discussing the possibility of introducing tax consolidation.
“For some time it was not in focus. But, given the current realities, we believe that this issue should be revisited, because it is a high-quality tax civilized practice. For example, our coal mining company UCC in the US consolidates taxes and reports for the entire list of legal entities – coal mining companies,” the CFO said.
Another important issue is tax duplication. For example, the group’s mining and processing plants pay several types of taxes for one facility: environmental tax, land tax, waste disposal fee and subsoil tax. Plus income tax.
“These all seem to be different taxes, but we pay a lot of them for just one quarry. It does not seem fair to us, and we believe that taxes are duplicated. We could use this resource for investments that will create new jobs. In addition, this is also budget revenues in the form of import VAT and customs duties. This is an increase in our efficiency, which in turn will generate more income tax,” the top manager is convinced.
As for the situation with VAT refunds for exported products, Metinvest, as an export-oriented company, expects VAT refunds, “and the mechanism is generally working, but there are some important issues that are not being resolved.” For example, some of the counterparties from whom the company purchases services or goods are considered risky by the tax authorities. These counterparties withdraw VAT, and it does not go to the budget, as it should according to the law.
Instead of targeting these risky taxpayers, the tax authorities deny VAT refunds to companies like Metinvest that operate in a formal and transparent manner. In essence, the tax authorities are punishing such companies because their unscrupulous counterparties do not pay VAT to the budget. This practice has been going on for many years.
Now, in the context of military operations, the importance of this problem is growing because it affects working capital. The company does not receive VAT refunds because the government has not learned how to deal with risky taxpayers. Ultimately, the state will see an increase in tax revenues if this issue is resolved. In addition, the tax office will not divert so many resources that can be directed to more useful things, Dankova believes.
The CFO expressed concern about the impossibility of reconstructing enterprises by 2026 as part of the EU’s increased requirements for environmental friendliness and emissions reduction due to the war.
“This is a challenge for Metinvest’s Ukrainian operations. We planned to rebuild our plants to produce low-carbon steel. However, we will not be able to complete the green transformation of our enterprises by 2026 because of the war. We cannot invest in large-scale projects in Ukraine right now. Therefore, there are two options: Ukraine’s accelerated accession to the EU and joining the European Emissions Trading System (EU ETS) or postponing CBAM requirements for Ukraine,” the CFO summarized.
“Metinvest is a vertically integrated group of steel and mining companies. The group’s enterprises are located mainly in Donetsk, Luhansk, Zaporizhzhia and Dnipropetrovs’k regions.
The main shareholders of the holding are SCM Group (71.24%) and Smart Holding (23.76%), which jointly manage it.
Metinvest Holding LLC is the management company of Metinvest Group.
In 2023, the State Service for Transport Safety (Ukrtransbezpeka) generated a record amount of revenues to the state budget – UAH 637 million, which is 3.1 times more than in 2022.
This was announced by the head of the service, Yevhen Zborovsky, at a press conference dedicated to the publication of Ukrtransbezpeka’s public report for the past year.
“These are record figures in the history of the State Service of Ukraine for Transport Safety. We can see a comparison with 2022… (in 2022, Ukrtransbezpeka generated UAH 205.1 million in budget revenues – IF-U),” the head of the service said.
He clarified that most of the amount is made up of fines and penalties. Last year, they were imposed for more than UAH 800 million.
The revenue figure is UAH 378 million from penalties imposed during raids. In particular, UAH 329 million from raid inspections involving freight transport and UAH 49 million from inspections involving transport engaged in freight transportation. In 2022, the amount of revenues amounted to UAH 111 million and UAH 10.5 million, respectively.
In addition, the budget received UAH 228 million in fines from auto-fixation of violations of dimensional and weight parameters recorded by Weight-in-Motion vehicle weighing systems.
Zborovsky noted that the UAH 637 million revenue figure is twice the amount allocated from the state budget for the maintenance of Ukrtransbezpeka, including salaries to employees.
The head of the service also noted that more violations were recorded last year, both in the freight and passenger transportation segments.
“In both situations, we see that there has been an increase in the number of violations detected. Indeed, compared to 2022, the country’s economy began to recover in 2023. The number of transportation began to grow, and at the same time, the number of violations increased,” Zborovsky said.
Ukrtransbezpeka also reported that the right to install wheel locks on vehicles and accompany them to the weight control point, which was granted last year, contributed to the increase in the efficiency of its work in 2023. Violations of weight and size parameters are recorded using WIM systems – 50 such systems have been installed in 20 regions, mostly on roads built in 2020-2021.
