An additional 10 billion hryvnias: the Verkhovna Rada is considering doubling taxes for banks

Ukraine is planning to double the tax rate on bank income, raising it from 18% to 36%. It is anticipated that this change will bring an additional approximately 10 billion Ukrainian hryvnias to the country’s budget each year.

The corresponding bill, numbered 9656-d, was approved by the members of the Verkhovna Rada in the first reading on October 19th.

A total of 247 deputies voted in favor of this measure, as reported by Yaroslav Zheleznyak, the First Deputy Chairman of the Committee on Financial, Tax, and Customs Policy.

Before the vote, the bill was revised. Initially, there was a plan to introduce a separate tax on bank super-profits. However, this approach raised legal concerns as it would have led to double taxation of income. Therefore, the decision was made not to introduce a separate tax but to increase the rate of the existing one selectively. It is expected that this change in the concept will not affect the expected revenue from the additional taxation of banks, and the budget will receive approximately 10 billion hryvnias additionally.

The tax will be introduced for the years 2024 and 2025, and there will be no retrospective taxation for income in 2023.

According to Zheleznyak, the provisions of the bill have already been discussed with banking associations. Additionally, the concept has received preliminary approval from the International Monetary Fund (IMF), but negotiations with the IMF will continue until the bill is considered in the second reading.