Status of budgetary payment revenues in 2020

Recently, the media has been spreading various information, in some cases untrue and incorrect, about the status of the taxpayers’ payments to the state budget, the administration of which is assigned to the State Tax Service. Some “experts”, pursuing unknown goals, manipulate data, disseminating incorrect and distorted information.

According to the State Treasury, during the first half of 2020, total revenues to the consolidated budget and state trust funds administered by the State Tax Service have increased by 68.2 billion UAH or 14.3% comparing to the same period in 2019, including:

- by 58.4 billion UAH (+ 26.4%) to the state budget;

- by 53.7 billion UAH (+ 24.8%) to the general fund;

- by 3 billion UAH (+ 2.4%) to local budgets;

- by 6.8 billion UAH (+ 5.2%) of the single social contribution to compulsory state social insurance.

Crisis, which unfolded in mid–March 2020, affected all countries without exception. The decline in production in basic industries has already become noticeable for our Ukrainian economy. For the first time in history, passenger traffic has almost completely stopped; situation on the labor market has deteriorated rapidly and there is a significant decline in the retail trade. Real GDP for the first quarter of 2020 has already decreased to 98.7% in comparison to the first quarter of last year – 102.9%.

The biggest decrease in revenues during April – June 2020 is observed in those industries that fall under the introduction of quarantine measures in accordance with the Resolutions of the Cabinet of Ministers of Ukraine, particularly for enterprises in the construction, trade  and transport sphere, etc. Peak of the revenues decrease is expected according to the results of declaration in the second quarter, ie in August. 

According to the State Treasury, in June 2020 the total revenues to the consolidated budget and state trust funds administered by the State Tax Service have increased by 50.6 billion UAH or 56.7% comparing to the same period in 2019, including:

- by 49.4 billion UAH (2.1 times more) to the state budget;

- by 45.3 billion UAH (2 times more) to the general fund;

- by 0.9 billion UAH (+ 4.3%) to local budgets;

- by 0.4 billion UAH (+ 1.6%) of the single social contribution to compulsory state social insurance.

Regarding the VAT revenues: in June 2020, revenues from this tax have increased by 3.9 billion UAH or 1.9 times comparing to June 2019.

Tax efficiency of the VAT has increased from 2.7% in April 2020 to 3.1% in May 2020 and almost to 3.5% in June 2020. These figures amounted 2.5% over the same period in 2019. With a decrease in supply by 19.5% in June 2020 (from 722.6 billion UAH to 581.4 billion UAH), the amount of 10.8% (20.2 billion UAH vs. 18.2 billion UAH) was paid more than over the same period in 2019. 

The indicative figures of the Ministry of Finance regarding the VAT, defined by the initial plan (excluding reductions) were exceeded by 29.1% or 1.9 billion UAH.

At the same time, the taxpayers receive VAT reimbursement on time. Over the first half of the year, taxpayers received reimbursement of 75.1 billion UAH of the VAT, comparing to 63.5 billion UAH claimed for reimbursement. Namely, 12 billion UAH was reimbursed in May 2020; 11.6 billion UAH in June 2020 with the declared 10.8 billion UAH in April and May 2020 and 9.3 billion UAH in June 2020. Accordingly, the reduction of debt incurred in 2019 is ensured.

Due to the effective prevention of fictitious tax credit formation, the amount of declared amounts subject to verification was reduced (from 25.6 billion UAH or 42% of the declared amount for the first half of 2019 to 18.9 billion UAH or 35% for the first half of 2020). 

Reference: 2.8 billion UAH or 26% in June 2020;

4.2 billion UAH or 39.6% in April 2020.

The VAT balance amounts declared for reimbursement, which are in operation, was reduced by 12.4 billion UAH or 45% (as of 01.07.2020 –15 billion UAH, as of 01.01.2020 – 27.4 billion UAH, as of 01.07.2019 –17.8 billion UAH).