The 2016 state budget adopted at night on December 25th had been a difficult decision. Basically, it’s not only the budget itself that was under adoption, but the wide package of comprehensive reforms to fiscal and budget legislation, which in turn regards each Ukrainian citizen. Although the majority of reforms proposed by the Government were not supported, the first necessary steps are made.
The proposed budget provides the rate of revenue growth at 18.9%, lower rates of Single Contribution, now at 22% (approx. 37% in 2015), reduction of the broad budget expenditures to 41.1% of GDP (52.4% of GDP in 2015), reduction of the estimated deficit to 3.7% of GDP (4.1% of GDP in 2015), significant narrowing of the quasi-fiscal expenditures to UAH 16 billion (UAH 107.8 billion in 2015), optimization of social expenditures.
Obviously, the December stage of voting process for the 2016 state budget is not the conclusive one. Final bill will come into view in March, 2016, shortly after the Government considers all the Parliament proposals and evaluates the first results of the reforms implementation. Local budgets, which had a chance to accumulate significant surpluses during the year 2015, will serve as budget saving, at this stage.
Read the full report “Complicated Budget 2016″.