The Ukrainian authorities are considering new changes to the mobilization rules aimed at exempting men with high salaries and regular tax contributions from service. Despite the lack of public discussion, this initiative has already caused outrage and generated a wave of negative comments. Economists see it as an attempt by the government to simultaneously solve mobilization problems and ensure budget financing. However, there is a risk that instead of solving existing problems, this initiative may create new ones, especially in the context of already existing accusations of discrimination and attempts to divide citizens into classes where only the poor should serve.
Ukrainian Forbes reported on the possible plans of the authorities to establish the right to reservation for those citizens who pay approximately 6 thousand hryvnias of personal income tax to the budget every month. The final version of the legislative changes has not yet been agreed, but several possible options are being considered.
It is noted that the specified amount corresponds to the official salary of approximately 33.4 thousand hryvnias, which is more than twice the average salary in Ukraine, according to the data of the Pension Fund. It is also 65% higher than the average salary in Kyiv, according to the Work.ua resource.
The option to exclude from mandatory mobilization those for whom the employer pays a single social contribution (USC) in the amount of about 14.5 thousand hryvnias (equivalent to a salary of 66 thousand hryvnias) is also being considered.
For IT-sector employees who will be exempted from mandatory service, a minimum salary threshold equivalent to $3,200 is being considered.
The principle of "pay tax or serve" is also planned to be applied to individual entrepreneurs, although the specific scheme has not been specified at the moment.
A source of BBC Ukraine, with close ties to the president's office, confirmed that such plans are being discussed. It is noted that there are major problems in the Ukrainian economy, and it is necessary to somehow keep it afloat.
However, the interlocutor adds: "But I'm in favor of taking 15 million, as much as is paid for a dead person, if this is to be done."
Such changes can be made in the significant draft law on new mobilization rules, which was presented by the head of the government, Denys Shmyhal, before the New Year. This project has already caused intense discussion and received numerous critical reviews. It is planned to discuss the draft law at the committee on January 10 and to vote on the first reading on January 12.
Difficult situation: new challenges for mobilization In December, President Volodymyr Zelensky announced that the military command plans to call up almost half a million recruits this year.
This is a significant figure, especially given the challenges the mobilization has faced over the past year.
The President emphasized that the cost of such a draft would be 500 billion hryvnias, and also added that one draft soldier is the equivalent of six taxpayers in the rear. In order to solve this problem, a draft law was introduced in the Verkhovna Rada, which envisages lowering the age of conscription into the army from 27 to 25, simplifying military registration and mobilization of conscripts, as well as introducing harsh sanctions for sabotaging conscription.
Although the draft law has not yet been voted on even in the first reading, it is obvious that its discussion in the parliament already promises to become the object of a tense confrontation.
On the other hand, maintaining an army during wartime, and especially new conscription, requires significant financial effort. Ukraine's economy has already been seriously affected by the Russian invasion.
The budget deficit for 2024 is 20% of the country's GDP. Practically all internal earnings are spent on the needs of the army. Planned expenditures on the military for 2024 amount to 1.6 trillion hryvnias, which is half of all expenditures approved in the budget.
The rest of the funds allocated for medicine, education and social benefits traditionally come from Western partners. However, the situation has become more complicated this year, as the US and the EU have not yet approved multibillion-dollar aid programs for next year.
Most likely, funds from the USA and the European Union will come, but the exact terms and amounts remain uncertain. The Minister of Finance of Ukraine, Serhiy Marchenko, emphasized that the situation is now even worse than at the beginning of the invasion, and called for caution.
If the budget lacks 5-10 billion due to the reduction of international aid, the situation will become difficult, but resolved. However, closing a larger "hole" will be a real challenge.
All this puts the authorities in front of a difficult choice - to take painful and unpopular measures, risking their ratings and popularity, or to endanger Ukraine's position in the war with Russia.
A Tense Dilemma: Mobilization and Social Justice
Bankova's latest initiative has sparked debate among economists, who see the move as a desire to mobilize while retaining the most efficient taxpayers and even attracting new ones.
The executive director of the Center for Economic Strategy, Gleb Vyshlinsky, called it "the best incentive for the legalization of wages in the history of the country" on his Facebook page. Economist Pavlo Kukhta regards this as a "demonstration of the authorities' competent approach" in the economy's war of attrition. Financier Serhiy Fursa, in a comment for the Ukrainian BBC, considers this a step towards effective warfare.
Fursa explains: "The state, determining who should serve and who should remain in the rear, should proceed from clear criteria. One of them is whether a person pays taxes, because taxes also finance the army." According to him, it will also encourage people to come out of the shadows, because many people do not pay taxes, even though they earn significantly more.
However, already on the first day, when it became known about the initiative, many indignant comments appeared on social networks. Current servicemen, many of whom decided to go to the front as volunteers, giving up high salaries or their own businesses, reacted particularly sharply.
Opponents believe that the initiative is a "blow to volunteers", that it discriminates based on property, dividing society into those who can "buy off" the army and those who cannot, creating grounds for social discontent.
Mobilization and social justice are now particularly sensitive issues for Ukrainians, given the difficult circumstances. Oleksiy Melnyk, co-director of foreign policy and international security programs at the Razumkov Center, notes: "Our government is trying to solve strategic problems without losing popularity." Such a task is extremely difficult."
American experience and justice in mobilization: discussion of Ukrainian society
In the past, the US had various methods for demonstrating the fairness of the draft while simultaneously replenishing the budget. For example, during the Civil War, a lottery was held to mobilize the army. Rich conscripts had the opportunity to officially buy themselves out of the service for a large sum of money or to find a replacement. Compared to this practice, not mobilizing individuals with high incomes may be "technologically efficient", but this may contradict the notion of justice in Ukrainian society.
Volodymyr Paniotto, a sociologist and CEO of KMIS, points out that while this method may be effective from a technological point of view, it may be perceived as unfair in Ukrainian society, where there is opposition to the rich receiving certain benefits.
Financier Serhii Fursa points out that the conflict between justice and efficiency arises in this matter. He believes that, while such a move may be controversial, it depends on how one understands fairness, and points out that it is also unfair if people do not fulfill their tax obligations.
Economist Anatolii Amelin from the Ukrainian Institute of the Future believes that the main problem of the government's initiative is its non-systematic nature and lack of a comprehensive mobilization strategy. He emphasizes that such an approach should cause uncertainty and commotion among society.
