REUTERS
The Ukrainian Finance Ministry expects Ukraine's economy to grow by 2%, with nominal GDP projected at about UAH 2.26 billion, as stated in a package of documents prepared by the ministry for the presentation of the 2016 draft national budget.
According to the document, the budget deficit is set at 3.7% of GDP, given the macroeconomic targets are achieved.
Budget revenues are projected at UAH 598 billion, calculated taking into account the abolition of import tax as of January 1, 2016, a reduction in single social security tax to 20%, transition to the general taxation system in agriculture, and a reduction by UAH 26.4 billion in profit transfers by the National Bank of Ukraine to the budget.
The Finance Ministry's forecasts are in line with those made by the country's key creditors, as well as leading rating agencies, according to which the Ukrainian economy is projected to grow by 1-2% in 2016. In addition, the target is also consistent with the base-case scenario of the economic development of Ukraine made by the government.
As UNIAN reported earlier, the Finance Ministry published the draft budget document – without appendixes, disclosing state allocations under each of the financing areas. According to the document, revenues are projected at UAH 598.2 billion, expenditures at UAH 674 billion, with the maximum budget deficit capped at UAH 83.7 billion, or about 4% of GDP, and the public debt ceiling set at UAH 1.5 trillion, or about 96% of GDP.
In addition, the Finance Ministry forecasts the maximum amount of state guarantees at the level of UAH 28.2 billion and an increase in the minimum income level to UAH 1,496, or $62.46 (at the official forex rate as of December 1, 2015) by the end of 2016.
The draft budget also foresees that the Ukrainian government will additionally funnel $500 million into the special reserve energy fund in 2016. The funds will be raised against state guarantees.