Ukraine will receive EUR 8.4 billion only after parcel taxation reform - Bloomberg

The European Union and the International Monetary Fund have set new requirements for Ukraine to receive financial assistance, which relate to changes in the taxation of international parcels. Bloomberg reports this with reference to informed sources.

EU member states have already agreed on the terms of a new large-scale support program worth about EUR 90 billion, designed for 2026-2027. However, the allocation of the macro-financial part of the loan in the amount of eight point four tenths of a billion euros will be clearly tied to the implementation of tax reforms by Kyiv.

To receive this financing, Ukraine must adopt legislative changes that provide for the expansion of the list of foreign parcels subject to a twenty percent value-added tax. According to journalists, the first tranche of the loan may arrive as early as June, the second in September, and the third by the end of the year, but each payment will depend on progress in reforms. This condition of the European Commission completely duplicates the IMF's requirements for the payment of another tranche of seven hundred million dollars to Ukraine, since the EU executive body is currently actively coordinating its actions with the Washington creditor.

The new aid package is being formed against the backdrop of a protracted war and Ukraine's high need for external financing, where the EU is actually becoming the main long-term donor along with the United States. It is assumed that the funds will be used to cover the state budget deficit, support the economy, restore infrastructure, defense spending and service the debt. Financing will be provided in the form of preferential loans and grants, but control over them will be much tighter.

The European Union and the IMF insist that Ukraine must gradually increase its own revenues by expanding the tax base, de-shadowing the economy, improving VAT administration and reforming the simplified taxation system in order to gradually reduce dependence on foreign infusions.

As Ukrainian News Agency earlier reported, the Bill on Taxation of International Postal Items provides that Ukrainians ordering goods from abroad will have to pay tax before receiving them.