Ukraine's Cabinet of Ministers approved the Budget Declaration for 2027–2029 through Resolution No. 793 on 17 June 2026, outlining tax reforms expected to raise an additional 122.6 billion UAH in 2027 and 213.9 billion UAH in 2028, including new rules for digital platform income, an extension of the 50% profit tax rate for banks and implementation of the OECD Two-Pillar Solution.
Ukraine’s Cabinet of Ministers issued Resolution No. 793 on 17 June 2026, approving the budget declaration for 2027–2029, which includes a broad package of tax measures aimed at increasing budget revenues, strengthening tax administration and supporting alignment with European Union standards.
The measures form part of the National Revenue Strategy until 2030 and are projected to generate an additional 122.6 billion UAH in state revenue in 2027 and 213.9 billion UAH in 2028.
Corporate tax and indirect tax measures
The government intends to extend the temporary 50% profit tax rate for banks through 2027.
The declaration also calls for gradual increases in excise tax rates on fuel and tobacco products to align with EU Directives. A new excise tax on sugar-sweetened beverages is proposed, while VAT rules for goods imported through international postal and express shipments would be revised.
Furthermore, revenues from the State Road Fund and social-economic risk compensation fees would be redirected to the general fund of the state budget.
Personal income tax and social contributions
The declaration provides for the restoration of the transfer of 4% of Personal Income Tax (PIT) to the state budget, reversing a temporary allocation to local communities.
It also proposes redirecting 75% of PIT collected from military salaries to the state budget to finance the security and defence sector, while the corresponding share for Kyiv would be 40%. Revenue from the military surcharge would be transferred to a special state budget fund for the exclusive use of the Armed Forces.
In addition, Ukraine plans to introduce taxation rules for individuals earning income through digital platforms. The rules will be aligned with EU DAC 7 and OECD Model Rules and are intended to bring into the tax system individuals operating through digital platforms without private entrepreneur registration.
Simplified taxation system reforms
Several changes are planned for the simplified taxation system to address perceived abuses.
These include measures to prevent artificial business fragmentation used to maintain eligibility for preferential tax regimes, restrictions on immediate re-entry into the simplified system after moving to the general taxation system, and the transfer of certain activities from the second group of the single tax regime to the third group.
The government also plans to introduce differentiated single tax rates of up to 10% for third-group taxpayers providing services.
Tax administration and compliance
The declaration outlines reforms intended to improve tax administration and compliance.
Information resources of the State Tax Service would be consolidated at the Ministry of Finance level under a neutral IT administrator. Electronic tax audits based on standard audit file submissions would initially apply to large taxpayers before being expanded to all VAT payers.
The government also plans to broaden the grounds for tax authorities to obtain extra-judicial access to information on the volume of funds held in taxpayer bank accounts.
OECD and international tax standards
Ukraine intends to implement the OECD Two-Pillar Solution to address tax challenges arising from the digitalisation of the economy.
The declaration also provides for further refinement of transfer pricing rules in line with international and OECD recommendations, as well as continued reform of the State Customs Service to reduce tax evasion involving customs payments.
Fiscal and economic outlook
The Budget Declaration is based primarily on a scenario assuming a significant improvement in the security situation from 2027.
Under this scenario, real GDP is forecast to grow by 4.5% in 2027, 5.3% in 2028 and 6.7% in 2029. The government aims to reduce the budget deficit from 17.7% of GDP in 2027 to 5.5% by 2029 through fiscal consolidation.
Defence spending will remain the highest budget priority, although projected expenditure is expected to decline from 2,757.2 billion UAH in 2027 to 1,692.1 billion UAH in 2029 as security conditions improve. The minimum wage is scheduled to increase from 8,000 UAH in 2026 to 9,546 UAH in 2027 and to 11,114 UAH by 2029.
Earlier, Ukraine published Law No. 4835-IX on 15 April 2026 in the Official Gazette, amending the Tax Code of Ukraine in relation to the collection and duration of the military levy.
