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Verkhovna Rada to revise bill for reduction of state budget for 2020

Source : 112 Ukraine

The state budget of Ukraine for 2020 decreased by 4.4 billion dollars
19:30, 30 March 2020

state budget
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The Verkhovna Rada will revise the bill on the reduction of the state budget of Ukraine for 2020 due to the coronavirus pandemic. Parliamentarians voted for the decision.

The state budget of Ukraine for 2020 was reduced by 4.4 billion dollars.

The total fund became 4.3 billion dollars.

These indicators decreased:

  • tax and levy on personal income by 666.8 million dollars due to a significant slowdown in wages growth;
  • corporate income tax by 746 million dollars due to the worsening of the financial results of enterprises, which is observed this year according to the results of the tax declaration;
  • rent by 821.8 million dollars mainly due to the preservation of low natural gas prices, non-fulfillment by JSC Ukrgasvydobuvannya of the volume of domestic gas production according to the Concept for Development of Ukraine's gas production industry and a decrease in oil prices;
  • excise tax by 446.9 million dollars mainly for excise tax on tobacco products due to taking to account lower production volumes;
  • VAT by 2.4 billion dollars due to the reduction in consumer and business activity of the population and farming, and a significant decrease in the volume of imports of goods;
  • import duties by 129,8 million dollars due to reduction of the volume of goods imports.

Net income and dividends increased by 951.4 million dollars due to changes in the rate of payments to the state budget.

Special Fund revenues were decreased by 41.6 million dollars.

The law establishes within the state budget Covid-19 Acute Respiratory Disease Fund for fighting with coronavirus consequences in the amount of 3.5 billion dollars, in order to prevent the spread and counteract negative effects of the disease in Ukraine.

It is envisaged that the Fund's money will be allocated for:

  • financial support for the healthcare sphere (additional payments to the salaries of medical staff, purchase of medical equipment and supplies (express tests, PCR analyzers for COVID-19, supplies for virological laboratories, mechanical ventilation devices, personal protective equipment, etc.);
  • social security (additional payments to the citizens of Ukraine, financial assistance to the Social Insurance Fund of Ukraine, the Compulsory State Social Insurance Fund of Ukraine in case of unemployment and providing a transfer to the Pension Fund of Ukraine);
  • resuming expenditures and granting loans under budget programs that have been reduced due to the creation of the Fund;
  • replenishment of the reserve fund of the state budget.

In case of the need for expansion of the Fund, the Ministry of Finance may, at the discretion of the government, make unplanned borrowing.

The expenditures and credits were cut, including:

  • payment of benefits and housing subsidies to citizens – 292,000 million dollars;
  • State Regional Development Fund – 267,2 million dollars;
  • support and development of united territorial communities – 74.8 million dollars;
  • payment of certain types of benefits, compensations, financial support and payment of services to certain categories of the population (the deadline for introducing increased amounts of some social benefits has been postponed from January 1 to July 1, 2020)– 67.7 million dollars;
  • work of the Energy Efficiency Fund – 57 million dollars;
  • субвенцію з державного бюджету місцевим бюджетам на проведення виборів депутатів місцевих рад та сільських, селищних, міських голів subvention from the state budget to the local budgets for holding elections of deputies of local councils and village, town, city mayors  – 42.7 million dollars;
  • statistical observations – 42.7 million dollars;
  • capital expenditures of central executive authorities – over 35.6 million dollars;
  • design and construction of the Dnepropetrovsk International Airport – 32 million dollars;
  • expenditures on business trips of public authorities – around  24.9 million dollars

In addition, the reserve fund for unforeseen measures, which according to the laws can be carried out at the expense of budget funds, but which are not permanent in nature and could not be foreseen during the drafting of the budget, increases by 106 million dollars.

Changes include additional expenditures, including:

  • ensuring the payment of pensions, allowances and rise of pensions allocated under different pension programs, and covering of deficit of the Pension Fund in the amount of 701.9 million dollars;
  • public debt servicing – 117.6 million dollars;
  • restructuring of the coal industry (wages for miners) – 57 million dollars, etc.

Salaries of top officials and members of supervisory boards have been reduced to 10 minimum wages (about 1,530 dollars), but only until the end of quarantine.

Financing for farmers has been fully maintained in full. Support for agricultural producers will reach 142.5 million dollars this year alone.

Expenditures for the latest technologies and capacity building for defense products have been saved at 89 million dollars.

Also, the financing of road construction and repair in Ukraine is almost 100% the same.

63,420 dollars was allocated for the financing of UA:PBC.

35.6 million dollars will be left for the local elections will leave (earlier it was 78.4 million dollars).

Capital expenditures of central government agencies were reduced by 35.6 million dollars, and funds for officials’ business trips were reduced by 24.9 million dollars. 

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