IMF may give Ukraine one year to approve VAT changes, Georgieva says
Kristalina Georgieva (photo: Getty Images)
The International Monetary Fund is considering giving Ukraine one year to adopt VAT changes for individual entrepreneurs under a new $8.1 billion lending program, IMF Managing Director Kristalina Georgieva said, according to Reuters.
As is known, Ukraine must meet a number of IMF conditions for new lending, including budgetary and tax policy reforms.
These include a tax on income earned through digital platforms (the so-called OLX tax), taxation of parcels worth up to 150 euros, and the introduction of VAT for individual entrepreneurs if their annual income exceeds 1 million hryvnias.
At the same time, the IMF acknowledged the need for flexibility. In particular, regarding the latter VAT requirement for individual entrepreneurs, Georgieva said the IMF is considering giving Ukraine one year to secure support from lawmakers to pass the changes in parliament.
Yesterday, parliament failed to consider bills important for EU and IMF financial assistance.
Georgieva also said that the situation in Ukraine had worsened due to damaged energy infrastructure and freezing temperatures, but Ukrainian authorities confirmed to her that they remain determined to move forward.
As Reuters writes, Georgieva said her goal is to ensure that Ukraine can meet the prior agreement despite "unusually harsh times." Ukrainian officials assured her that they remain committed to moving forward.
Visit of IMF chief to Kyiv
On Thursday, January 15, International Monetary Fund Managing Director Kristalina Georgieva arrived in Kyiv for high-level talks.
She met, in particular, with President Volodymyr Zelenskyy and Prime Minister Yulia Svyrydenko to discuss the IMF program for 2026–2029, which is critical to ensuring Ukraine's macro-financial stability.
New IMF program
The new IMF program is expected to replace the current four-year program totaling $15.5 billion, of which about $10.6 billion has been disbursed so far.
In November, Ukraine and the IMF reached a preliminary agreement on a new four-year lending program totaling $8.1 billion.
Overall, since February 2022, the International Monetary Fund has provided $13.4 billion to Ukraine, becoming the fourth-largest provider of budget support.
