Ukraine budget switches to UAH 53 bln surplus in August

Ukraine’s general budget switched to a surplus of UAH
52.9 bln in August from a deficit of UAH 3.8 bln in the prior month, the State
Treasury reported on Sept. 24. General budget revenue surged 35% yoy to UAH
174.0 bln after increasing 26% yoy in July. General budget expenditures inched
up 8% yoy to UAH 120.8 bln, after increasing 1% yoy in July.

In 8M21, the general budget surplus amounted to UAH
34.5 bln (vs. a deficit of UAH 15.1 bln in 8M20).

Tax revenue jumped 37% yoy to UAH 156.9 bln in August,
accelerating from 28% yoy growth in July. In particular, enterprise profit tax
more than doubled year on year, VAT on imported goods surged 38% yoy. The
revenue from personal income tax increased 20% yoy. Meanwhile, net VAT inched
up 4% yoy (vs. 29% yoy in July) as gross VAT revenue increased 12% yoy and VAT
reimbursement increased 26% yoy.

Non-tax revenue increased 20% yoy to UAH 16.4 bln in
August (after increasing 20% yoy in July). In particular, the revenue of
budget-financed entities increased 47% yoy; administrative payments
advanced 39% yoy. Meanwhile, revenue from ownership and entrepreneurship
dropped 53% yoy.

Evgeniya Akhtyrko: It is typical for the Ukrainian budget to switch to a surplus in
August as a result of moderate budget expenditures during the peak of the
holiday season in the country. However, the surplus of this year is incredibly
high. It would be logical for the government to accelerate expenditures for the
construction of infrastructure while the weather permits. It might be that the
growth potential of this government project is currently limited by the lack of
labor and technical resources.