Date
12/2/2024 6:28:32 AM
(MENAFN) Ukrainian President Volodymyr Zelensky has signed a controversial law raising taxes to help manage the country’s growing budget deficit. The law, which was passed by parliament in October and signed into effect on Thursday, introduces a tax increase on individuals, with rates rising by 1.5% to 5% of income. A new “war tax” will be imposed on entrepreneurs and small businesses, while a 50% tax on bank profits and a 25% tax on financial companies are also included. These changes will come into effect starting December 1.
The decision has sparked strong opposition, with many criticizing it as unpopular. Yaroslav Zhelezniak, deputy head of the parliamentary committee on finance and tax policy, referred to the tax hike as "historic," and questioned the 44-day delay in signing the bill, which he argued cost the national budget millions. Opposition lawmakers have denounced the tax increase, calling it a "shameful decision."
Despite the backlash, Finance Minister Sergey Marchenko emphasized that the tax hike is crucial for securing the funding needed for Ukraine's defense sector, which consumes around half of the national budget. Additionally, Zelensky signed a state budget law for 2025, forecasting $87 billion in expenditures, with a $37 billion shortfall. This financial strategy relies on support from the IMF, the EU, and a $50 billion G7 loan backed by frozen Russian assets.
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