Tax rise will contribute to international partners' willingness to support Ukraine

The Ukrainian government's approval of a new tax package will increase Ukraine's international wepartners' readiness to continue their support.

Source: Gavin Gray, Head of the International Monetary Fund (IMF) mission to Ukraine, as cited by Interfax-Ukraine, a Ukrainian news agency

Details: Progress in passing the tax package will have an impact on international partners’ willingness to continue supporting Ukraine: once the government approves the tax package, there will be more willingness to continue support, Gray said.

Gray believes this will demonstrate Ukraine’s efforts to become more self-sufficient and independent of foreign aid, given the significant spending that will be required  in the medium term.

Gray says that international partners' support, commercial debt restructuring, and tax increases should be considered as a single package focused on the result: eliminating the funding gap.

Background:

• The budget deficit is UAH 500 billion (roughly US$12.02 billion): if the Ukrainian parliament does not support the government's taxation package, military payments may be affected as early as September.
• The Ukrainian parliament will not vote on the bill raising a number of taxes until September, and the concept of the draft law has changed. 

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