Page 37 - UKRRptJul21

after the fallout of the lockdown of March-May 2020. The June 2021 decline was apparently expected by the government. Meanwhile, the customs revenue continues growing at a high pace.
The higher comparative base of 2H20 promises fewer swings in year-on-year changes in budget revenue in the upcoming months.
Ukraine's state budget revenue provisionally rose 22.6% y/y to UAH476.1bn in 5M21, outperforming the plan by 4.7%, the State Treasury reported on June 1.
Net tax revenue increased 32.9% y/y to UAH240.2bn (6.3% above the plan) amid 24.1% y/y growth in gross tax revenue and a 0.8% y/y decline in VAT reimbursement. Customs revenue jumped 38.5% y/y to UAH143.3bn (3.8% above the plan).
Local budgets' fiscal revenue improved 20.4% y/y to UAH135.5bn in 5M21, which is 2.5% above the plan. Social payments (pensions and other social fund contributions paid by employers) advanced 17.5% y/y to UAH132.8bn.
In May alone, the state budget revenue surged 61.6% y/y to UAH118.6bn, which is 1.8% above the plan. Net tax revenue advanced 73.7% y/y to UAH75.0bn (4.8% above the plan) amid a 59.4% y/y growth in gross tax revenue and a 7.8% y/y increase in VAT reimbursement. Customs revenue surged 58.6% y/y to UAH29.5bn (0.3% above the plan).
The low comparative base of the previous year was an additional factor of accelerated growth of budget revenue in May. Nevertheless, budget collections remain strong, driven by the recovering economy and government efforts in combating tax evasion.
Ukraine’s general budget switched to a surplus of UAH3.2bn in May from a UAH1.8bn deficit in the prior month, the State Treasury reported on June 25. General budget revenue surged 54.3% y/y to UAH149.1bn, accelerating from 8.8% y/y growth in April. General budget expenditures increased 24.0% y/y to UAH146.7bn, accelerating from 16.0% y/y growth in April.
In 5M21, the general budget deficit amounted to UAH4.9bn (vs. a deficit of UAH32.0bn in 5M20).
Tax revenue surged 45.4% y/y to UAH128.9bn in May, accelerating from 44.1% y/y growth in April. Net VAT revenue jumped 62.1% y/y (vs. a 59.6% y/y increase in April), as gross VAT revenue increased 27.1% y/y and VAT reimbursement increased 7.8% y/y. The growth of revenue from personal income tax increased 26.6% y/y (vs. 34.2% y/y growth in April). In addition, royalty payments on the use of natural resources climbed 86.8% y/y (vs. 60.5% y/y in April).
Non-tax revenue surged 169.7% y/y to UAH19.0bn in May (after declining 37.8% y/y in April). The surge was mostly due to a jump in revenue from ownership and entrepreneurship, which increased ten times year-on-year.
May’s surge in budget revenue was partially due to a low comparative base of 2020 (when it fell 25.3% y/y). The government didn’t rush to accelerate the budget expenditures, which helped to come up with budget surplus in May.
37 UKRAINE Country Report July 2021 www.intellinews.com