EU sets conditions for first €3.2bn Ukraine tranche, including tax on low-value parcels and customs reform

Tetyana Vysotska, Anastasia Protz - 20 May, 16:34

The EU flag. Photo: Getty Images

Ukraine must fulfil a number of conditions to receive the first €3.2 billion tranche of EU macro-financial assistance in June: submit a bill to abolish the VAT exemption for imported parcels worth up to €150, update the Customs Code and appoint a permanent head of the State Customs Service.

Source: European Pravda's Brussels correspondent, citing information provided by a European Commission official on condition of anonymity

Details: To receive the first tranche of budget support from the EU's €90 billion loan, Ukraine must implement several reforms, including submitting an updated Customs Code and appointing a permanent customs chief.

Sources told European Pravda that the conditions for the first tranche include a requirement for Ukraine to submit draft laws to the Verkhovna Rada (Ukrainian parliament) on key tax measures, such as abolishing the VAT exemption for low-value imported parcels (up to €150), as well as legislation on the taxation of digital platforms, which is already in place.

Another requirement is the extension of the military levy on personal income, a measure that has already been approved by parliament and signed by the president of Ukraine.

Ukraine is also expected to:

adopt legislation supporting the development of sectoral public investment strategies
approve a Public Finance Management Strategy
submit an updated Customs Code of Ukraine to the Cabinet of Ministers (Ukrainian government)
appoint a new permanent head of the State Customs Service.

Background:

On 20 May, Ukraine and the EU initialled a Memorandum of Understanding on €8.35 billion in macro-financial assistance under the EU's €90 billion loan programme.
Earlier, European Pravda learnt that Ukraine will need to implement a number of reforms related to the rule of law and anti-corruption efforts in order to receive part of the budgetary support from the EU's €90 billion loan.
Sources told European Pravda that these requirements will be based on elements of a plan outlined by EU Enlargement Commissioner Marta Kos and Taras Kachka, Ukraine's Deputy Prime Minister for European and Euro-Atlantic Integration. These concern reforms in the rule of law and anti-corruption areas where Ukraine is currently not demonstrating sufficient progress.

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