MPs propose to raise the environmental tax fourfold

Environmental tax revenue will increase from ₴3.5 billion to ₴14 billion in 2020

A group of MPs from the Sluga Narodu faction presented a draft law proposing to increase the environmental tax fourfold.

This was stated in the explanatory note to the registered draft Law No. 2367 proposing respective amendments to the Tax Code of Ukraine.

The co-authors of the draft law were MPs Yevgeniy Shevchenko, Danylo Getmantsev, Oleg Bondarenko, Yuriy Mysyagin, Olena Shulyak, David Arakhamia, Dmytro Natalukha, Yuriy Kamelchuk and Yevgen Kravchuk.

They propose a fourfold increase for every component of the tax rate:

• for emission of pollutants into the air by stationary sources
• for discharge of pollutants into water bodies
• for placement of waste at special designated areas or on site
• for generation of radioactive waste (including the already accumulated waste)
• for temporary storage of radioactive waste by its generators beyond the time limits established by the special license conditions

According to the explanatory note, “the adoption of this draw law, in the opinion of its co-authors, will increase the environmental tax revenues to the state budget from expected ₴3.5 billion to estimated ₴14 billion.”

The Ukrainian industry expects the government to ensure transparent allocation of the environmental tax revenue.

In 2018, local budgets received 55% of the collected environmental tax, including the СО₂ tax. This money is meant for funding environmental measures. 45% of the environmental tax revenue went to the state budget. It’s very difficult to control the use of this money.

The government increased the СО₂ tax rate 25 times for 2019 and deprived the local self-government of the right to use that money.

At the same time, in 2017–2018, iron ore mining companies alone increased investment in environmental projects by 30.3% to ₴7.3 billion, while steelmaking companies increased respective expenditures by 25.5% to ₴5.9 billion.