NBU: IMF mission to review EFF program for Ukraine scheduled for late May

MOSCOW. April 30 (Interfax) - The International Monetary Fund (IMF) mission's work on the first review of the new Extended Fund Facility (EFF) program is expected to begin in the last ten days of May, Ukrainian media reported, citing National Bank of Ukraine (NBU) Governor Andrei Pyshny at a briefing on Thursday.

During the next round of mission talks, discussions on fiscal measures, which were initiated at the Spring Meetings of the IMF and World Bank Group in Washington, will continue, he said. Specifically, Pyshny said that an agreement has now been reached regarding the postponement of the sensitive issue of introducing the value-added tax (VAT) for individual entrepreneurs.

"The Ukrainian delegation returned from Washington with the understanding that this issue related to VAT for sole proprietors has been postponed. I am confident that further discussions will be held as part of the IMF mission. We expect the relevant work to begin at the end of May, that is, approximately in the last ten days of the month," Pyshny said.

He added that Ukraine is offering its partners alternative ways to cover fiscal needs by stepping up efforts for de-shadowing the economy, and some results have already been achieved, specifically in matters related to the State Customs Service reform and improving the effectiveness of the Economic Security Bureau.

He said that the NBU had backed the government's stance to seek additional domestic resources for the budget in order to avert unproductive pressure on gold and forex reserves.

The introduction of VAT for sole proprietors with annual incomes exceeding UAH 4 million is a structural benchmark of the new IMF financing program, which is also the subject of discussions with the European Commission as part of the memorandum on the 90-billion-euro macro-financial assistance. The Ukrainian side insists that introducing this regulation during a crisis is unconstructive and is working to delay its implementation by one year, until 2027.

Ukrainian Finance Minister Sergei Marchenko confirmed at a meeting of the temporary parliamentary commission that the issue of introducing VAT for sole proprietors could be postponed based on the mission's findings, but it remains on the agenda.