Shmyhal: we lose 35-50% of GDP with ongoing war
March budget is 95% executed owing to paid in advance taxes from large companies and earlier paid dividends by banks
What happened. The Prime minister reveals how much the Ukrainian economy has suffered from the war.
Source. Interview by Denys Shmyhal to NV.
Details. "The regions affected by the ongoing war are home to 30% of enterprises responsible for over 50% of GDP. Currently, we are losing 35% to 50% of GDP with active military actions. It is a heavy blow to the economy. Nevertheless, we have enough reserves. March was relatively smooth, despite the war. All the military and social spending was appropriately conducted. April will be more complex than March," says the Head of the government.
As explained by Shmyhal, over the first quarter, the budget has been over-fulfilled. All because the war had not been brought upon us yet in January and February. And so advancing happened. The tax plan was 121% completed.
In March, the tax plan was also over-fulfilled. Many big companies paid their taxes in advance, while state-owned companies and banks paid their dividends earlier than expected. That is how we get 134% which is an overachievement of the target. Overall, in March, the budget was executed by 95%.
"The Customs Office provided the budget with only 20%, which has to do with a much lower turnover. Presently we have exempted all kinds of businesses from paying customs fees. The Customs Office is working accordingly, and humanitarian aid is delivered with no additional bureaucracy–just one page to fill in," the prime minister notes.
Shmyhal states that all goods are imported without restrictions and obstacles. Hence, treasury revenue decreases. But the Head of government emphasizes that it is crucial "to liberalize the Customs Office" to satiate our country with essential goods and food products.
"Further down the line, we will review this policy depending on how events unfold. The war economy and economy under martial law presupposes more assertive state governance because conditions are constantly changing," he underlined.
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