Ukraine 2018 budget revenue rises 17%, below plan

Ukraine’s 2018 state budget revenue rose 16.9% yoy to
UAH 928 bln, which is 1.3% below plan, the State Treasury provisionally
reported on Jan. 4. Net tax revenue climbed 18.7% yoy to UAH 391 bln (0.5%
below plan), while customs revenue rose 11.5% yoy to UAH 339 bln (1.4% below
plan). Other budget revenue surged almost three times yoy to UAH 102 bln (0.6%
above plan).

In December alone, net tax revenue surged 26.1% yoy to
UAH 32.9 bln, which is 0.1% above plan. Customs revenue dropped 1.3% yoy to UAH
29.7 bln, which is 13.8% below plan. Other budget revenue in December rose
46.5% yoy to UAH 9.8 bln, which exceeds plan by three times. December state
budget revenue of UAH 84.9 bln (22.4% yoy growth) was 6.5% above plan.

Local budgets’ 2018 revenue increased 14.9% yoy to UAH
244 bln, outperforming plan by 0.8%. Social payments (pension and other social
fund contributions paid by employers) jumped 26.1% yoy to UAH 228 bln.

Evgeniya Akhtyrko: The
underperformance of the state budget on the revenue side was in line with our expectations.
Unexpectedly low devaluation of the national currency was apparently one of the
reasons for lower-than-expected government collections. In particular, the
budget was drafted with an expected 2018 exchange rate of UAH 29.3/USD while
the actual average exchange rate was UAH 27.3/USD. Mostly, this mismatch
affected customs collections.

As the underperformance of state budget revenues
was widely expected, expenditures were likely adjusted in order to prevent the
budget deficit from exceeding 2.5% of GDP, which could upset the IMF.