With the onset of autumn 2024, Ukrainians may face rising prices, which will be associated with several factors, including an increase in taxes. The Cabinet of Ministers of Ukraine has submitted changes to the state budget for consideration, foreseeing additional military expenditures in the amount of over 500 billion hryvnias. A significant portion of this sum is planned to be covered by increasing taxes.
Changes in Tax Policy
One of the main changes will be an increase in the military levy and excises. The government proposes new levies: 1% of income for legal entities, 5% for individual entrepreneurs of groups I, II, and IV, 1% for group III individual entrepreneurs, 5% on banking metals and jewelry, 5% on real estate sales and mobile communication, 15% of automobile purchases. It is also planned to introduce an excise tax on water and reduce the duty-free threshold for parcels to zero.
These tax initiatives have sparked lively discussions. Yaroslav Zheleznyak, the first deputy chairman of the financial committee of the Verkhovna Rada, stated that changes will be made to the draft, and some of them may come into effect from October 1. In particular, an increase in the military levy from 1.5% to 5% is envisaged, as well as the introduction of new rates for individual entrepreneurs and banks.
Economic Forecasts and Inflation
The National Bank of Ukraine forecasts that inflation will accelerate in the coming months but will remain moderate. Economist Oleksiy Plotnikov notes that prices will rise due to summer power outages, which forced businesses to operate on expensive generators. The inevitable increase in the cost of production is due to rising logistics and production costs.
Rising Food Prices
Analyst Maksym Hopka warns that food prices will start to rise from the end of September. The main reasons are the increase in fuel prices, which will raise logistics costs, and the rising cost of raw materials for processing enterprises. Already, purchase prices for milk have increased by 30% compared to last year, and grains have become 20-30% more expensive.
Fuel market: forecasts and excises
Starting from September 1, excise rates on gasoline, diesel, and autogas will increase, which may lead to a 9% rise in fuel prices by the end of the year. However, expert Serhiy Kuyun notes that diesel and gasoline prices may not rise significantly due to falling purchase prices. At the same time, the excise on liquefied gas will increase several times, but even after that, gas will remain an economically beneficial fuel.
Exchange rate of hryvnia: stability or fluctuations?
Moderate fluctuations in the hryvnia exchange rate are expected in the currency market. The National Bank will intervene actively to avoid sharp fluctuations. Experts predict that the hryvnia exchange rate against the dollar may range from 41.4-41.6 UAH/USD at the beginning of September, and by the end of the year, it could reach 42 UAH/USD. However, significant devaluation of the hryvnia is not expected, as the National Bank will limit such processes.
