Ukraine has virtually no alternatives to international financial assistance to cover the budget deficit, said Danylo Hetmantsev, the chairman of the Verkhovna Rada's tax committee.
According to him, none of the domestic instruments is capable of providing the necessary amount of resources. We are talking about raising taxes, government borrowing, emission or cutting spending.
Hetmantsev stressed that reducing defense spending is currently impossible, as the country is in a state of full-scale war. At the same time, increasing taxes, according to him, will not have the expected effect and may negatively affect the economy and the level of shadow economy.
He called the issuance of funds an extreme measure that is not considered a realistic scenario.
As an example of the scale of the problem, the deputy cited a calculation: to replace about $40 billion in foreign aid, taxes would have to be sharply increased.
“ 1% VAT gives almost 50 billion hryvnias. That is, to compensate for such a volume of funds, it would be necessary to increase VAT to approximately 55% ,” explained Hetmantsev.
According to him, such figures demonstrate that attempting to cover the deficit with domestic resources alone is unrealistic.
Recall, we previously wrote that without EU funding, Ukraine may face the risk of non-payment of social assistance as early as 2026, which once again emphasizes the budget's critical dependence on international support.
