Kiev announces tighter regulations on Ukrainians spending money abroad
Date
9/18/2024 8:26:58 AM
(MENAFN) In a significant move to address capital flight amid ongoing economic challenges, Ukraine’s central bank has announced tighter regulations on citizens purchasing luxury items and managing real estate abroad. Effective September 10, these measures aim to mitigate financial outflows as the country navigates martial law conditions.
Under the new guidelines, Ukrainians will be limited to spending a maximum of 100,000 hryvnias (approximately USD2,430) per month on luxury goods, which include watches, jewelry, silver products, gemstones, and precious metals. The National Bank of Ukraine (NBU) noted that this restriction extends to cards issued by Ukrainian banks in foreign currencies, marking a notable shift from previous policies that only applied to national currency cards.
The NBU's analysis revealed that affluent Ukrainians had been attempting to bypass existing restrictions on purchasing precious metals overseas through various schemes. To further regulate financial activities, the central bank has introduced a monthly cap of 500,000 hryvnias (USD12,150) on transactions involving real estate agents and managers abroad. This limit also encompasses rental payments made with different payment cards issued by Ukrainian banks. The NBU emphasized that this amount should suffice for approximately 98percent of customers of national banks who reside or travel abroad.
The central bank’s decision is designed to prevent attempts to evade established financial restrictions and to safeguard against significant capital outflows from Ukraine.
In addition to these measures, the NBU has facilitated state companies in acquiring carbon dioxide emission quotas from non-residents and has streamlined processes for Ukrainian e-commerce businesses to pay value-added tax (VAT) in the European Union. These changes are intended to bolster defense procurement efforts, particularly those reliant on air transport.
As Ukraine continues to face economic pressures, these new regulations reflect the government’s commitment to stabilizing its financial system and ensuring resources remain within the country during challenging times.
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