Budget committee recommends Parliament to approve budget report for 2018

5/15/19

On May 15, the Parliament’s budget committee considered the Government’s report on the execution of the Law of Ukraine “On the State Budget of Ukraine for 2018”. According to the report, the revenues of the state budget in 2018 were equal to UAH 928,114.9 million, the expenditures were equal to UAH 985,851.8 million. The re-payment of loans was equal to UAH 6,797.9 million, loans provided from the state budget amounted UAH 8,312.1 million. The deficit of the state budget amounted UAH 59,251.1 million.

In total, 33.3% of the GDP were re-distributed through the consolidated budget of Ukraine in 2018 according to preliminary data (compared to 34.1% in 2017).
The revenues of the state budget in 2018 amounted UAH 928,114.9 million, which is equal to 101.1% of the revised plan and is UAH 134,673.1 million (17%) higher compared to 2017.

According to the Accounting Chamber, the main contributors to the revenue increase of the state budget compared to the previous year were increased imports, rising prices, higher earnings of profitable companies and higher dividends paid by the JSC “National Company “Naftogaz””.

The performance of the state budget’s general fund was positively influenced by the following unplanned revenues:
• revenues from the corporate profit tax (+ UAH 14,921.3 million, equal to + 18.5%);
• share of the net profit of state-owned companies transferred to the state budget and dividends paid out by companies partially owned by the state (+ UAH 3,390.1 million, equal to + 9.6%);
• fee for the issue, re-issue and prolongation of licenses for the use of radio frequencies in Ukraine as well as issue of duplicates of such licenses (+ UAH 1,582.7 million or + 24.5%);
• rent fee for the use of subsoil resources for oil production (+ UAH 639.1 million or + 13.1%);
• revenues from the income tax (+ UAH 618.1 million or + 0.7%).

The revenues of the special fund of the state budget amounted UAH 94,499.5 million, which is UAH 19,354.2 million higher compared to the revenues set by the Law (+ 25.8%). This increase happened mostly due to the increased own revenues of public entities (+ UAH 20,466.6 million or the 1.8fold of the plan) and the revenues from the excise on imported goods (products) (+ UAH 2,222.3 million or + 9.3%).

The deficit of the state budget in 2018 was equal to UAH 59,251.1 million, which is – according to preliminary data – equal to 1.7% of the GDP and UAH 21,398.2 million lower than the limit set by the Law. The deficit of the general fund of the state budget was equal to UAH 45,137.9 million, which is UAH 12,898.4 million lower than the limit set by the Law.

In 2018, the expenses of the state budget for the debt re-payment and debt service amounted UAH 349,899 million, which is 26.2% lower compared to 2017.
The total volume of the public debt and government-backed debt as per December 31, 2018 was equal to UAH 2,168,421.6 million (according to preliminary data, this is equal to 60.9% of the GDP) and reduced significantly compared to the debt volume in the end of 2016 and 2017 (80.9% and 71.8% respectively).

The expenses of the state budget in 2018 amounted UAH 985,851.8 million (99.4% of the budget allocations and 95.3% of the reviewed budget plan).

Compared to 2017, the expenses of the general fund of the state budget increased by UAH 126,644.8 million (+ 16.7%), which is mainly due to the following spending posts:
• public order, security and judiciary system (+ UAH 24,299.7 million or + 31.7%);
• defence (+ UAH 19,065.8 million or + 29.7%);
• social welfare (+ UAH 17,395.8 million or + 12.1%);
• economic activities (+ UAH 16,823 million or the 1.9fold);
• general state functions (+ UAH 16,629.4 million or + 12%), including debt service (+ UAH 4,975.1 million or + 4.5%);
• transfers to local budgets (+ UAH 23,754.1 million or + 9.1%).
The Pension Fund received from the state budget UAH 150,091 million, which is UAH 16,632.4 million (12.5%) higher compared to 2017.
In the reporting period, local budgets received transfers from the state budget amounting UAH 298,939.7 million, which is equal to 99% of the respective budget assignments (general fund – UAH 285,032.7 million equal to 99.9% of the budget assignments; special fund – UAH 13,907 million equal to 84.6% of the budget assignments). The share of transfers from the state budget in the revenues of local budgets was equal to 53.2% and reduced by 1.1% compared to 2017.
Subventions from the state budget to local budgets amounted UAH 273,773.7 million (99% of the budget assignments), including:
• subventions for the implementation of state social welfare programmes – UAH 125,207.7 million (98.3% of the budget assignments);
• healthcare subvention – UAH 61,650.2 million (107.5% of the budget assignments due to the increase of this subvention by UAH 4,283.5 million according to article 30 of the Law on the State Budget as part of the implementation of the programme of healthcare guarantees for primary healthcare services);
• education subvention – UAH 60,423.8 million (97.9% of the budget assignments, but equal to 100% as per the reviewed plan).

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