Ukraine approves sweeping tax breaks to help businesses weather the war

1 minute read

Ukrainian Prime Minister Denys Shmygal speaks during a news briefing following talks with Polish Prime Minister Mateusz Morawiecki in Kyiv, Ukraine February 1, 2022. REUTERS/Valentyn Ogirenko

Register now for FREE unlimited access to Reuters.com

LVIV, Ukraine, March 15 (Reuters) - Ukraine's parliament approved measures on Tuesday to help Ukrainian businesses stay afloat during the war with Russia, including slashing taxes to a single 2% rate, Prime Minister Denys Shmygal said.

The war - the biggest in Europe since World War Two - has caused a humanitarian and economic shock, with the International Monetary Fund warning this week of a possible 35% contraction in output.

The new bill was backed by President Volodymyr Zelenskiy, who has called for the government to ramp up support for small and medium-sized businesses in particular.

Register now for FREE unlimited access to Reuters.com

The new incentives include a new single 2% tax rate for all businesses with turnover of less than 10 billion hryvnia ($338 million) compared with a previous value-added tax of 20% and 18% tax on profit, Shmygal said in a statement.

"I am confident the decisions will strengthen our economic front," he said in a statement.

In a later video address, Shmygal also outlined other war-time stimulus measures including a loan programme for farmers worth 25 billion hryvnias ($846 million).

($1 = 29.5474 hryvnias)

($1 = 29.5474 hryvnias)

Register now for FREE unlimited access to Reuters.com
Reporting by Natalia Zinets and Max Hunder, Writing by Alessandra Prentice, Editing by Timothy Heritage

Our Standards: The Thomson Reuters Trust Principles.