Today, August 25, 2020, the Verkhovna Rada of Ukraine has supported as whole the draft Law of Ukraine "On Amendments to the Law of Ukraine "On the State Budget of Ukraine for 2020" initiated by the President of Ukraine Volodymyr Zelenskyy. The project envisages a gradual increase in the minimum wage with its size UAH 5,000 a month (an increase of 5.9%) from September 1.
"At that, the ratio between the size of the salary of employee of the I tariff category of the unified tariff system (UTS) and the minimum wage, which has made up this year 44.5%. To implement these initiatives, the draft amendments to the state budget for 2020 provide for an increase in expenditures by UAH 4 billion," said Finance Minister Serhii Marchenko in his statement in the Verkhovna Rada.
The increase in expenditures for the payment of increased minimum wages and salaries of employee of the I tariff category of UTS will be carried out due to the following:
- cost savings under the budget program "Public Debt Service" in the amount of UAH 3.5 billion, which is caused, in particular, by the deviation of the actual exchange rate of national currency against foreign currency compared to the forecast used while preparing the state budget for 2020 (with changes);
- revision of the forecast of state budget revenues in connection with the increase of the minimum wage from September 1, 2020 to UAH 5,000.
Thus, revenues will be increased by UAH 0.5 billion, including personal income tax and military duty (UAH 0.4 billion), value added tax on goods (works, services) produced in Ukraine, taking into account budget reimbursement (UAH 0.1 billion).
"In general, the proposed changes will stimulate the growth of consumer demand, will ensure the de-shadowing of "gray" wages. This will allow to increase the budget revenues of the Pension Fund, strengthen the stability of the budget and the pension system, as well as improve the protection of labor and social rights of citizens," said Serhii Marchenko.
The bill is balanced and will allow to improve the quality of life of citizens by raising the income of the working population.