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Government Approved Draft Law on Amendments to the State Budget Increasing Expenditures on National Security and Sefense of the General Fund by UAH 518.2 billion

On March 13, the Cabinet of Ministers of Ukraine approved the draft Law of Ukraine "On Amendments to the Law of Ukraine "On the State Budget of Ukraine for 2023" on Provision of Expenditures for the Security and Defense Sector".

The draft law was developed to further implement urgent measures aimed at countering the armed aggression of the russian federation against Ukraine.

The proposed changes to the budget bring total expenditures for the security and defense sector to UAH 1,670 billion, which is 26.6% of GDP.

The draft law provides for an increase in expenditures of the general fund of the State Budget by UAH 537.2 billion, including:

  • UAH 518.2 billion for the security and defense sector, of which UAH 477.2 billion will be spent on salaries and wages, UAH 30.2 billion for special machinery and equipment, UAH 10.8 billion for other expenses;\
  • UAH 19.0 billion for the reserve fund.

These expenditures of UAH 60.7 billion will be partly covered by the following revenues:

  • personal income tax in the amount of UAH 36.5 billion;
  • dividends (income) accrued on shares (stakes) of business entities with state ownership in their authorized capital in the amount of UAH 19.0 billion.

The budget also provides for an increase in the financing of the general fund of the State Budget by debt operations in 2023 by UAH 419.3 billion, including an increase in the amount of state borrowing.

The forecast amount of the state debt at the end of 2023 in national currency equivalent decreased by UAH 229.5 billion and will amount to UAH 6.2 trillion as a result of changes in the financing of the State Budget from debt sources, changes in the forecast exchange rate of the hryvnia against the US dollar, and the actual execution of the State Budget in 2022.

In addition, the draft law takes into account savings in the performance of debt and guarantees obligations of UAH 57.2 billion.