At a regular meeting in late December 2016, deputies of the Verkhovna Rada voted to approve the state budget for 2017. At the same time, excise taxes on alcohol and tobacco products were increased, changes to the currency exchange procedure were adopted, and amendments to the Criminal Code were introduced.
Overall figures
The results of the adopted distribution of funds do not lend themselves to any positive forecast. With planned expenditures of 790,000,000,000 hryvnias, only 721,000,000,000 hryvnias in revenue are expected. Due to this difference, the GDP deficit will be 3%, and the expected inflation rate is 8%.At the same time, a quarter of all planned revenue will come from loans, more than half of which will be domestic. All other budget revenues will come from VAT and personal income tax. In the currency exchange process, 2% of the total amount will no longer be deducted to the pension fund, but excise taxes on low-alcohol beverages and tobacco products have increased by 20% and 40%, respectively.
Distribution by sector
No significant changes are planned in the social sphere. The minimum wage will rise to 3,200 hryvnias, and pensions, adjusted for inflation, will be increased twice during the year, resulting in a rise from 1,247 to 1,373 hryvnias by December. The same will happen with the subsistence minimum: it will be increased first in May, then again in December, eventually reaching 1,700 hryvnias instead of the initial 1,544.Almost 89,000,000,000 hryvnias were allocated for healthcare. Of this, 5.9 billion will go to the purchase of medicines, 150,000,000 to new cardiovascular surgery centers, and 500,000,000 will be compensation for medications for patients with asthma, diabetes, and various cardiovascular diseases. Preventive programs will receive additional funding.
In the education sector, 56,600,000,000 hryvnias are allocated for teachers' salaries. The scholarship fund has been significantly increased by reducing social scholarships and increasing academic ones – it now stands at 5,800,000,000 hryvnias. In addition, a new reform in this sector provides for a redistribution of responsibility. Salaries and training of state specialists are still financed from the state budget. For everything else, including utilities and all types of benefits, local authorities are now responsible in each region.
Whether the 2017 budget will work will be known at the end of the year. But not all experts are confident that this budget will meet the needs of the population, even considering the increase in the minimum wage.