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Ukraine to resume excise tax on fuel to replenish budget during war


Drivers stay in line outside a petrol station as they try to buy fuel, amid Russia’s invasion of Ukraine, in Kyiv, Ukraine May 11, 2022. REUTERS/Viacheslav Ratynskyi

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KYIV, Aug 15 (Reuters) – The Ukrainian government has asked parliament to partially restore excise tax on petrol and diesel fuel to boost the state budget, depleted by months of war with Russia, Infrastructure Minister Oleksandr Kubrakov said on Monday.

He said the resumption of excise tax at 100 euros ($101.96) per 1,000 litres could provide the state budget with about 2-3 billion hryvnias ($135.54 million) each month amid a monthly deficit of about $5 billion.

“The finance ministry is in a challenging situation,” Kubrakov told a televised briefing. “Any additional revenues to the budget from taxes that were previously cancelled are essential and matter.”

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He said the tax could be launched in September or October.

Ukraine cancelled excise tax – which was 213 euros for petrol and 140 euros for diesel fuel – in March after Russia invaded Ukraine on Feb. 24 and cut logistic chains.

Ukraine used to import the majority of the fuel it consumes from Belarus and Russia. Parliament cancelled excise tax to help traders make enough profit to fill the domestic market with fuel from Europe.

“The situation stabilised in July. There is enough fuel at gas stations,” the minister said.

He said the partial resumption of excise tax should not cause a substantial rise in retail prices in Ukraine as fuel was getting cheaper on the world market.

($1 = 36.8892 hryvnias)

($1 = 0.9808 euros)

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Reporting by Natalia Zinets, Editing by Timothy Heritage

Our Standards: The Thomson Reuters Trust Principles.



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