ILLUSTRATIVE PHOTOGRAPHY, GETTY IMAGES
The director of the International Monetary Fund's European Department, Alfred Kemmer, expects Ukraine to generate domestic revenue if budget spending rises due to the war.
Source: Voice of America
Details: This is how Kemmer answered the question of whether international donors are ready to increase their assistance to Ukraine if budget costs increase due to war and mobilization.
The IMF representative noted that the fund's support is focused on supporting the work of the state and its social obligations, and not on the military sphere.
Kemmer's direct speech : “I always emphasize very clearly – we expect domestic revenues to be generated. Strengthening the economy, structural reforms that support economic activity, better governance will provide additional tax revenues.
We support and monitor the budget as a whole, not individual expenditures, and we and donors help the Ukrainian government perform essential functions during war, such as protecting vulnerable populations, paying wages, pensions, paying for education and the like. This is exactly what the 122 billion financing program is aimed at.”
More details: If there are additional fiscal costs due to the war, Kemmer says better management and, in particular, the National Revenue Strategy, which the government approved on December 28 to implement the terms of the IMF program, should help generate additional revenues.
The strategy will “receive more budget revenues and support spending needs during this time,” says a Fund official.
He added that the National Revenue Strategy is also important to build a modern state, and a modern state needs investment.
According to him, the private sector in Ukraine needs to create an environment that will allow it to receive tax revenues and finance expenses.
Background:
- Speaking to the press this month, Zelensky noted that an additional mobilization of 450,000 to 500,000 people would cost Ukraine another 500 billion hryvnia.
- He added that in order to finance one military man, six taxpayers are needed, that is, another three million people need to work to pay for the increase in troops.
