Popular science material by Ivan Sokolovskyi, Candidate of Sociological Sciences: “The National Revenue Strategy: economic effects and social consequences”

The website of the Institute of Sociology of the NAS of Ukraine has published a popular science material by Ivan Sokolovskyi, Candidate of Sociological Sciences, "The National Revenue Strategy: economic effects and social consequences".

On 27 December 2023, by Decree No. 1218-r, the Cabinet of Ministers of Ukraine approved the National Revenue Strategy to 2030. Its adoption by the end of 2023 was one of the IMF's requirements of Ukraine before the next review of the current funding programme. This event and the provisions of the National Strategy did not provoke much public resonance, although their implementation — specifically the provisions concerning changes in taxation — will have an effect on and will touch a substantial part of working Ukrainians.

It is worth noting that Ukrainians' level of awareness of how taxation is arranged in the country and of which taxes they pay was very low before the beginning of the full-scale war, and there are no grounds to suppose that the situation has changed since it began. Citizens' low awareness of questions of taxes, the budget and payment for public services means that their attitude to changes in this field is formed not on the basis of analysing the changes themselves but on the basis of how they are positioned and covered by the media and, at best, commented on by experts. In the case of the National Revenue Strategy, everything looks very simple at first glance — its adoption was one of the IMF's conditions. In the statement made by the IMF's Managing Director Kristalina Georgieva after the conclusion of the 2023 Article IV consultations and the second review of the programme under the Extended Fund Facility (EFF) for Ukraine on 12 December 2023, “revenue mobilisation is an important component for meeting financing needs and supporting recovery and social spending. Fiscal policy priorities should include launching the National Revenue Strategy, avoiding measures that erode the tax base, and advancing reforms to strengthen the medium-term budgeting system further”.

The adoption of a National Revenue Strategy which also provides for the mobilisation (that is, the increase) of revenues therefore looks like a logical and natural decision. But by what means is this increase in revenues to be achieved?

The full material is here