President Yanukovych sends tax code back to parliament

President Viktor Yanukovych vetoed the tax code yesterday. The code was passed by the Verkhovna Rada, Ukraine’s parliament, on November 18. The president’s decision was linked to protests across Ukraine, the largest since 2004’s Orange Revolution, including crowds of several thousand in Kyiv’s Independence Square, against provisions seen as unfriendly to small and medium sized businesses. Parliament Speaker Volodymyr Lytvyn said the Rada could take up consideration of the veto and amendments as early as Thursday. Brad Wells: That the president bowed to popular pressure with the veto is notable from a political standpoint, as he has acted unilaterally, leaving little or no room for debate on policies, since coming to power in February.  The next key signal of the government’s responsiveness to the public is whether it actually makes a substantial overhaul to controversial sections or just cosmetic changes to the tax code; top officials have yet to publicly weigh in on the scope of potential changes. At the same time, the presidential veto increases the likelihood that any tax reform would not go into effect until 2012, vs. January 1, 2011 as initially planned.