Economics

Under the knife - development projects: how to remove the "military" PITs will affect communities

The government expects to receive UAH 93. 7 billion in 2024 by withdrawing funds from the local budgets from the tax on the income of servicemen. These funds will be directed to the State Budget Special Fund for Defense Financing. Focus interviewed experts warn: communities will have problems with financing their expenditures. Revenues from personal income tax have increased significantly over the last year. Thus, in January-March 2023, local budgets received UAH 24.

6 billion in revenues that 329% more than in 2022. This was due to the increase in the number of servicemen and the amount of their cash payments. Focus writes about it in the new article "There will be less money for asphalt? Why do military taxes take away from local communities. " Government Bill No. 10037, which has supported the Parliament, proposes to withdraw funds of "military" PIT from local budgets in favor of the State Budget Special Fund since October 1.

The initiative was preceded by reports of the purchase of things from local budgets, such as vegetables and drums, not urgent in the war. "There are conscientious communities that support the military and do not spend money on inappropriate purchases, but not all communities are such - so we see tenders for the construction of stadiums and translation of asphalt.

These are the funds that can and should be fully directed to the defense forces", " - said the head of the Committee on Budget of the Verkhovna Rada of Roksolana Podlas. Since funds from such PITs were paid at the place of registration of enterprises, more of them were received by communities where military units were registered. Thus, those OMS that have no such objects experience funding problems.

"The Ministry of Finance takes such communities where military units are registered where the sidewalks are bridged because they have money to laugh money and protrude them as the top of wastefulness and says: now we cut our heads to all. And 110 billion minus a year. This is a third of all PITs" - says Yuriy Ganushchak, director of NGO "Institute for Territories".

With the seizure of "military" PIT, the number of scarce budgets will increase from 227 to 543 according to the calculations of the Center for Economic Strategy, if local budgets do not receive "military" PIT, the number of scarce budgets will increase from 227 to 543, including 270 . "The issue of withdrawal of such significant cash from local budgets during the war should be treated with extreme caution," the lawyer of the law firm "Ilyashev and partners" Dmitry Lazebny.

" Local territorial communities without receipt of funds can have extremely negative consequences. " According to Ganushchak, the adoption of the initiative will lead to the fact that a number of programs that are in local budgets will have to be reduced. First of all, under development, major repairs will go under the knife. In addition, it is dangerous on the eve of the heating season.

"Local self-government does the main work to support the life of settlements in which servicemen and their families live. And this PIT allows to make subsidies for infrastructure, to prepare cities for winter, when the enemy will break electricity, gas supply. communities, etc. The state does not finance it all, and without the life of cities, the opportunity to use them for defense will be significantly reduced, we have a great outflow of personnel, great emigration.

If you take money for infrastructure, then the central budget will not finance it all. What are the consequences of this in winter? In addition, as of now, the state did not compensate for the local budgets of all expenditures. "It is in particular about UAH 35 billion in gas tariffs that disrupts the preparation for the heating season. Also, local communities do not receive planned funds for the restoration of damaged objects, social payments, etc.

All this significantly complicates the socio-economic situation in the regions. ", - said Candidate of Economic Sciences, independent expert Alexander Khmelevsky. Recall that the government project of the State Budget-2024, which was transferred to the Council, by 5%, compared to this year, increased expenditures on the Ministry of Social Policy. In particular, social protection of citizens who have been in difficult circumstances (including IDP support) propose to allocate UAH 88.