Ukraine budget deficit swells to UAH 129 bln in December

Ukraine’s general budget deficit swelled to UAH 129.0
bln in December, compared to a UAH 5.3 bln budget gap in November, the State
Treasury reported on Jan. 27. General budget revenue jumped 28.3% yoy to UAH
161.4 bln in December, speeding up from 13.7% yoy growth in November. General
budget expenditures surged 44.3% yoy to UAH 290.0 bln, accelerating from 11.5%
yoy in the prior month. In particular, state budget expenditures advanced 79.9%
yoy, while local budget expenditures declined 6.6% yoy.

In 2020, the general budget deficit amounted to UAH
223.7 bln (vs. a deficit of UAH 84.3 bln in 2019).

Tax revenue jumped 43.1% yoy to UAH 144.2 bln in
December, accelerating from 9.6% yoy growth in November. In particular,
personal income tax revenue increased 10.5% yoy (vs. 11.8% yoy growth in
November). Net VAT revenue surged 44.7% yoy (vs. 36.5% yoy growth in November),
as VAT gross revenue climbed 45.5% yoy and VAT reimbursement rose 46.5% yoy.
Enterprise profit tax proceeds surged 122.2% yoy (vs. a 13.7% yoy plunge in
November). Resource royalty payments surged four times year-on-year in December
(vs. 10.5% yoy growth in November). Personal income tax revenue increased 13.9%
yoy (vs. 8.5% yoy growth in November).

Non-tax revenue plummeted 32.6% yoy to UAH 16.6 bln in
December (after surging 63.8% yoy in November) due to a slide in income from
ownership and entrepreneurial activities. At the same time, the revenue of
budget-financed entities jumped 37.4%, while administrative payments and
revenue from non-commercial activities advanced 14.0% yoy.

Evgeniya Akhtyrko: As we
expected, the budget deficit skyrocketed in December, as the government rushed
through its completed budgeted “commitments.” December’s tax revenues were
boosted by the ever-increasing enterprise profit tax, as well as royalty
payments. And this increase amid a mostly lethargic economy was very likely the
result of “additional efforts” exerted by fiscal bodies.