Arseniy Yatsenyuk: Our objective is to gain reputation among consumers within the EU and to encourage internal market

For the first time in recent years economic downturn has stopped in Ukraine: "Previous quarter has demonstrated rather small but growth – 0.7%", said Prime Minister of Ukraine Arseniy Yatsenyuk at the meeting of the Export Promotion Council on Monday, December 10.

Arseniy Yatsenyuk reminded that starting January 1 the DCFTA with the European Union will enter into force, the Government of the United States decided to restore the system of preferences for over 3.5 thousand Ukrainian commodity items.

He stressed that the Agreement on free trade area "represents both an opportunity and a challenge": "This is an opportunity for us to sell more products, but this is also an opportunity for our allies and partners to enter the Ukrainian market and to offer their products, which have high quality and will be competitive in price. Therefore, our task is just to enter their markets, to offer our goods and also to gain reputation among their consumers, the way it is done in the countries all around the globe".

At the same time, Arseniy Yatsenyuk stressed, the most important is to encourage the domestic market, including by forming large orders for state-owned companies.

In particular, according to him, for the Ukrzaliznytsia alone the Government plans in the draft financial plan for the next year funding for capital expenditure - renewal of rolling stock, rail tracks, infrastructure construction – UAH 15 billion.

"Therefore, to encourage the domestic market and to replace the flows, including those going to Russia, proves possible", he added.

"The budget will also perform its function. Inasmuch as, the domestic consumption lies in the increase in social standards and purchasing ability of citizen," he said. Arseniy Yatsenyuk reminded that year the Government had managed to increase welfare standards by 13 and 19%, but inflation was rather high.

"The next year, I think, we will balance the level of growth of prices and the level of growth of social standards. On the one hand, it will allow citizens to reimburse losses to the citizens due to rising prices, on the other - to increase the level of commodization of the domestic market and to enlarge domestic consumption", said Arseniy Yatsenyuk.

Arseniy Yatsenyuk reminded that the Ukrainian authorities adopted a "common decision to submit a single harmonized Tax reform". The Head of Government noted that the text of the Tax Code had been elaborated by the Ministry of Finance with the assistance of Price Water House.

Apart from that, the Prime Minister stressed that it was agreed to reduce the tax rates from 1 January 2016, “that is, to enact the body of law from the second quarter of next year." According to the Head of the Government, this will enable the entrepreneurs to get familiarized with the law: "Thus, we will have another three months to resolve the ambiguity in the text of the Tax Code".

Arseniy Yatsenyuk recalled that there have been long discussions regarding the transition to general taxation system and elimination of so-called special regime of taxation by the value added tax for agricultural enterprises: "Everyone should be on equal terms. That is, everyone will get to 100-percent payment of the VAT,then everyone will get the VAT refund on export items".

"We realize that this is a difficult step for the agricultural sector. And direct allowance from the state budget will be now hard to find. Therefore, we have embarked on talks and will offer to Parliament the following decision: 75% of the value added tax is paid by agricultural companies to the state budget, while 25% remain at the disposal of the agricultural companies for the development of their own business and the support of the agricultural sector", said Arseniy Yatsenyuk.

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