According to the recent Tax code update, Ukrainians should pay more for alcohol & tobacco products in 2016. The excise taxes have increased steeply: tobacco products – by 40%, low alcohol beverages – by 300%, beer and wine – by 100%, alcohol beverages – by 50%. The expected contribution to Ukraine’s 2016 budget of these increased tax rates is projected at 18.1 billions UAH. Vice taxes thus have the potential to generate substantial revenues for the Ukrainian budget, so the Ukrainian government might well want to consider additional vice taxes.
Monthly Archive: February 2016
Index for Monitoring Reforms (iMoRe) from VoxUkraine aims to provide a comprehensive assessment of reform efforts by Ukraine’s authorities. The Index is based on expert assessments of changes in the regulatory environment in five areas. The iMoRe value for the 29th monitoring period (February 8 – 21, 2016) stood at +1.4 points out of the possible range from -5.0 to +5.0 points. The Index growth was provided by the law on public procurement adopted by the Parliament at the end of 2015 and signed by the President on February 16.
Youth unemployment is an indication of wasted talents and underused economic resources; it spoils personal lives of the unemployed and leaves scars on their future career, earnings, health and social life. Ukrainian labour market seems to be more favorable for the young than in the EU countries. It is rather robust to the economic downturns. Youth unemployment of 15% rate in 2013 seems to be far less of a problem in Ukraine than it is in the EU where it reaches up to 55% at the extreme (Greece), with much wider gap between the young and 30+ people.
Despite the bitter scent of renewed political bickering, the failed NCM has helped to avoid an even greater disaster (early elections would not only take a lot of precious time, but could give rise to populist politics and endanger the success of reforms). Still, the coalition parties have to avoid the political stalemate by quickly reaching agreement over changes in the government and accelerating the reforms. Hopefully, this will be done, given the pressure of domestic audience and international partners. The memories about the 2005 post-Maidan political fiasco and the second anniversary of Euromaidan sacrifices should also help.
The Ukraine Reform Monitor provides independent, rigorous assessments of the extent and quality of reforms in Ukraine. The Carnegie Endowment has assembled an independent team of Ukraine-based scholars to analyze reforms in four key areas. This fourth memo covers the period from December 2015 to mid-February 2016. In early 2016, the administration of Ukrainian President suffered a series of major setbacks that threatened a new political crisis in Ukraine. The government failed to secure the necessary support in the parliament for a decentralization reform. This in turn raised new doubts about the feasibility of the Minsk process aimed at settling the conflict in eastern Ukraine and the prospects for peace there.
On February 15 and 16 Tom Coupe and Boris Davidenko conducted workshop on how to write academic papers for international academic journals and how to write columns for the Ukrainian press. Tom shared how to write academic papers, which have a chance to be accepted for publication in international academic economics journals and Boris Davidenko explained what press editors want to see when they consider columns for publication. Please see Tom’s and Boris’s presentations.
The project’s ‘rental’ arm has been the primary method of conducting farmland transactions for farmers and landowners. On the other hand, its ‘sales and purchases’ arm is dysfunctional due to a moratorium on farmland sales that was introduced in 2001. The moratorium was originally intended as a transitional measure that would lastfor 5 years. But since then, it has been extended several times and currently is set to expire on January 1st 2017.
Discussions around agricultural tax exemptions have been in the focus of a hot political fight between the Ministry of Finance and agrarian lobby for more than a year. More than UAH 20 bn of forgone budget revenues is at stake. On the New Year eve, some compromise was reached, whereby agricultural lobby and the sector lost a great deal of its tax benefits. Agricultural lobby, however, does not give up and prepares for a revenge. Oleg Nivievskyi demonstrates some of the empirical evidence showing no impact of tax benefits on agricultural sector productivity growth.
At the beginning of 2015, the Ukrainian president approved the Strategy 2020 program, a strategy which includes 25 key performance indicators which can be used to assess Ukraine’s progress in implementing the strategy program. In a series of upcoming posts we will evaluate how likely it is that Ukraine will reach some of these KPIs by 2020. Here, we evaluate ‘ being in the Top 40 of the Global Competitiveness Index’.
The IMF Statement About a Possible Cut of Aid to Ukraine is a Disgrace For the Ukrainian Authorities
The IMF Managing Director Christine Lagarde’s statement about a possible cut of aid to Ukraine unless it makes direct specific efforts to fight corruption is a negative signal to the Ukrainian economy. Delay in lending may result in the devaluation of the national currency and slowing down or even reversing the tentative economic growth. Moreover, such statements imply that the Ukrainian authorities have no interest in structural reforms that are essential, primarily for the country and the citizens of Ukraine and not for the external creditors.