Ukraine budget revenue plunges 14.0% yoy in February

Ukraine’s state budget revenue fell 14.0% yoy in February, the state Treasury reported on March 4. For the two months this year, state collections reached UAH 52.2 bln, which is 4.2% less than the same year-ago period.

Alexander Paraschiy: Though the warlike conditions and hryvnia devaluation did not create the environment needed for state revenue to increase, we attribute the February revenue slump to a high statistical base effect. For 2013, the Cabinet of Ministers changed the mechanism for enterprise profit tax collection. As a result, two payments overlapped in February 2013 and companies ended up making both an advance payment and the enterprise profit tax for the prior quarter. Against this backdrop, it’s no surprise to see state revenue slump dramatically in February. Nevertheless, a revision of the spending plan is badly needed and the new finance minister already promised to do so by the end of March.