Ukraine has a critical need to raise additional funds to the budget - more than UAH 500 billion this year. The money is needed to pay salaries to the military and to purchase relevant equipment for the defence industry. It cannot be borrowed from international partners.
There are several options to raise this amount, said Prime Minister Denys Shmyhal at the Ukraine 24. Independence forum. The first is to increase domestic borrowing.
"Our market is ready for this. Financial institutions, banks, the NBU - we have held relevant negotiations and see potential here by the end of the year. The second is an increase in the corporate tax rate for banks. The third is to expand the base for the military tax by increasing the military tax rates for certain cases," he said.
Ukraine will also introduce the principle of "fight or work" - measures designed to bring the labour market out of the shadows. This is expected to increase the number of jobs and the level of average wages, and to fill the budget.
Since 2022, Ukraine has lost 3.5 million jobs - 30% of the economy. To support the military, at least 10 million jobs are needed, and there are officially less than 8 million of them.
"There are a number of professions in the economy that work in the shadows, do not pay taxes, which are critically needed by the Defence Forces. The principle of fight or work is not new, it was voiced by the President of Ukraine, and we all agree with this principle. People must either fight or do everything to provide those who are fighting with everything they need," the Prime Minister explained.
There are a number of de-shadowing measures both for people who receive salaries in envelopes and for those who are now abroad.
Shmyhal added that there is an unmet need for $15 billion for the next year. There are several scenarios to raise this amount, including frozen Russian funds.
"Our goal is to get all $300bn. The first step is $50 billion from our partners in the form of a grant," the Prime Minister explained.