Salaries will decrease due to the increase in military tax.
Ukrainians' salaries will decrease. The MP told what will happen with payments in 2025. However, the state has money for pensions next year. Zelensky himself stated this. What will happen to the “minimum” and the subsistence minimum, should we expect pension indexation and why Ukrainians' salaries will become smaller.
Victoria Panchenko told about this in an exclusive to TSN.UA.
Salaries will decrease
All legal incomes of Ukrainians will decrease due to the increase in military tax. And this has already happened since December 1 after the law on increasing taxes came into force. This was reported by the people's deputy, member of the Verkhovna Rada Committee on Finance, Tax and Customs Policy Nina Yuzhanina on air at “Kiev24”. She explained that the net income “on hand” will become smaller. “Absolutely all income that you legally receive anywhere – this is at work as an employee, accrued interest on deposits in banks – all this will be taxed at the military tax rate of not 1.5%, but 5%.”
Historic tax increase
Let us recall that Ukrainian President Volodymyr Zelensky signed a law on increasing taxes on November 28. The law on the historic tax increase is to come into force on November 29. The text of the law was even published in the online version of the parliamentary newspaper Golos Ukrainy.
However, the document was then removed. Later, Danilo Getmantsev, head of the Verkhovna Rada Committee on Finance, Tax and Customs Policy, announced that the law would come into force on December 1. Key changes: the military tax rate will increase from 1.5 to 5% for all citizens' income. This decision is part of the government's efforts to finance defense spending. The income tax rate for banks will increase to 50% for 2024. For individual entrepreneurs (IE) on the simplified tax system, a military tax of 1% of income for single tax payers of group III will be introduced, and for groups I, II and IV – 10% of the minimum wage. Earlier, TSN Week host Alla Mazur also explained what will change in tax payments after the law comes into force.
However, there are a number of citizens in Ukraine who are exempt from paying the military tax. In particular, in July 2022, President Volodymyr Zelensky signed a law according to which military personnel are exempt from this tax, namely: the Armed Forces of Ukraine, the National Guard, the Security Service of Ukraine. All other categories of citizens will not be exempt from paying the military tax.
“Minimum” unchanged
Let us recall that in 2025, the minimum wage will remain at UAH 8,000, and the subsistence minimum will be UAH 2,920. The salaries of public sector employees and other social benefits are tied to these indicators. Moreover, the draft budget for 2025 does not provide for an increase in salaries for teachers and doctors. Next year, the salaries of prosecutors and judges will increase. The minimum wage for next year was approved by the Cabinet of Ministers of Ukraine when adopting the draft state budget for 2025. Finance Minister Serhiy Marchenko noted that the social sphere is a priority. That is why its funding will continue to be stable. However, there is no talk yet of increasing the minimum wage.
“At this stage, and this was also agreed upon with partners, we do not have the opportunity to increase social standards. This year, we increased the minimum wage by 19% – to UAH 8,000.”
The Cabinet of Ministers approved by Resolution No. 751 of June 28, 2024 “On Approval of the Budget Declaration for 2025-2027” that some minimums in the social sector will remain unchanged. In particular, this concerns: the minimum wage, the subsistence minimum, the minimum pension. That is, the subsequent increase in these indicators may occur in 2028.
There is money for pensions
However, all pensions will be paid. This was stated by the President of Ukraine Volodymyr Zelensky. He assured that there are funds for their payments in Ukraine. He said this on November 19, speaking in the Verkhovna Rada.
Pension indexation
It is noteworthy that pensions will be indexed in 2025. However, even if the pension is increased in 2025, for most pensioners the changes will be insignificant. After all, with the payment amount of 3,000 hryvnia, indexation by 12% is weakly felt.
Pension may be taken away
At the same time, in the draft law on the state budget for 2025, the government proposes to take money from the bank accounts of IDP pensioners registered before February 24, 2022, if they have not been identified. That is, Oschadbank will be obliged to transfer the remaining funds in the pension accounts of IDPs opened in this bank back to the Pension Fund of Ukraine.
In addition, pensioners abroad can undergo a physical identification procedure in November and confirm their right to a pension. Pension payments to such pensioners will be made to current accounts of banks located in Ukraine, provided that they undergo physical identification before December 31 of each year. The next pension indexation in Ukraine will take place in March 2025. Preliminary pensions may increase by 10 to 17%.
Work experience
The minimum work experience requirements for retirement in 2025 will also increase. If you want to retire at 60, your work experience must be at least 32 years; at 63 – from 22 to 32 years of experience; at 65 – at least 22 years of experience. The later a pensioner retires, the higher the amount of financial assistance. Therefore, the amount of payments can be increased if you postpone retirement.
Pension reform
In 2025, Ukrainians can expect two stages of pension increases: indexation, which will take place in March, and an increase in the amount of payments for some pensioners in the summer. However, an increase in social benefits is possible after changes in legislation. This was stated by the Minister of Social Policy Oksana Zholnovych on the air of the telethon “Edinye Novosti”.
According to her, the increase in pensions will most affect Ukrainians who retired long ago. “They will all receive an increase. This will depend on the amount of the paid unified social contribution and length of service. The minister also noted that large pensions will not be cut.
Zholnovich also announced a pension reform that the Verkhovna Rada must adopt.
Recall that in 2025, pensioners, including Chernobyl victims, will receive additional pension supplements of more than 2 thousand hryvnia.