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| 18 May 1998 | 07 |
UKRAINIAN PRIME MINISTER VALERIY PUSTOVOITENKO REFUSES FROM HIS MP MANDATE
ZERO IMPORT DUTY RATE TEMPORARILY INTRODUCED FOR UNREFINED SUNFLOWER, SOYBEAN OIL
PRESIDENT URGES TO REDUCE TAX ON WAGE PAYMENT FUND TO 35% IN THE SECOND HALF OF 1998
FORMER SPEAKER MOROZ CRITICISES DISTRIBUTION OF POWER WITHIN EXECUTIVE BRANCH
SIMPLIFIED TAXATION, BOOKKEEPING FOR SMALL BUSINESSES IMPOSED BY PRESIDENTIAL DECREE
NUMBER, STAFF OF UKRAINE's PARLIAMENTARY FACTIONS APPROVED
LEADER OF CRIMEAN COMMUNISTS LEONID HRACH BECOMES HEAD OF CRIMEAN SUPREME COUNCIL
UKRAINIAN PRIME MINISTER VALERIY PUSTOVOITENKO REFUSES FROM HIS MP MANDATE
KYIV. On May 11, the Central Election Committee has abolished its
decision about the registration of Ukrainian Prime Minister Valeriy
Pustovoitenko as MP from the People's Democratic Party's (PDP) list
according to the report that he submitted.
During his meeting with reporters Mr. Pustovoitenko said that he has
no moral duty to step aside at the moment when the task of utmost
importance is to preserve the consistency in the work of the
Government and executive power in general. So he decided to continue
to work in the Cabinet of Ministers. The Ukrainian President has given
the Government powers until the end of 1999.
Mr. Pustooitenko topped the PDP's election list. He refused from his
seat in the Parliament in favor of his position as Prime Minister. Mr.
Pustovoitenko will be replaced in the Ukrainian Supreme Council by
Serhiy Larin, Deputy Head of the Donetsk Oblast State Administration's
Department, who was 23-d in the PDP's list.
ZERO IMPORT DUTY RATE TEMPORARILY INTRODUCED FOR UNREFINED SUNFLOWER,
SOYBEAN OIL
KYIV. The President of Ukraine has issued a Decree by which a
temporary (by September 1, 1998) zero import duty rate is introduced
for unrefined sunflower and soybean oil which is imported to Ukraine
within the quota provided by the same Decree.
This quota for sunflower oil amounts to 100,000 tons and for soybean
oil - 20,000 tons. Besides that, a quota for importing palm oil and
its distillates to Ukraine has been introduced (15,000 tons) for the
period until September 1, 1998. The import duty for it has not been
lowered but VAT payment may be postponed for the period of up to 30
days. The same holds true for the sunflower and soybean oil quotas.
All the oil imported within the quota will be refined at the Ukrainian
plants defined by the Agricultural Policy Ministry. This raw material
is made exempt from mandatory certification and its re-exporting is
forbidden.
PRESIDENT URGES TO REDUCE TAX ON WAGE PAYMENT FUND TO 35% IN THE
SECOND HALF OF 1998
KYIV. It is high time the government and parliament of Ukraine agreed
to a considerable reduction of taxes on producers, President Kuchma
said in his address to parliament that convened May 12. As of the
second half of 1998, taxes on corporate wage payment fund must be
lowered to 35 percent, instead of the present almost 50 percent, said
the President.
The President also called for the gradual reduction to 10-15 percent
of the VAT tax and simpler VAT collecting procedures. Besides, maximum
tax on individual incomes must not exceed corporate income tax rates.
At present, the former is 10 percent higher that the latter. The
President also urged to raise the untaxed minimum income level to low
income level. Payments to the Pension fund, stressed the President,
must be brought down from the present 40% of the GDP in 1998 to 35% in
1999 and to 30% in 2000. As of the second half of 1998, there should
be a single fixed tax on agricultural producers in Ukraine, said the
President.
Provided these measures are implemented, parliament can enact the tax
code of Ukraine in the first half of 1999, thinks Kuchma. Following
this, it would be advisable to introduce a 5-year moratorium on
changes to the tax code. Simultaneously, the President promised
tougher penalties for companies and individual businessmen that evade
taxes.
FORMER SPEAKER MOROZ CRITICISES DISTRIBUTION OF POWER WITHIN
EXECUTIVE BRANCH
KYIV. The influence of the cabinet of ministers, as a central
executive power body, on local governments is inadequate, whereas the
President wants to have a larger say in executive branch and even
judicial branch decisions, said former speaker Olexandr Moroz,
addressing the newly elected parliament on May 13. In the former
speaker's opinion, this is one of the main reasons underlying the
present instability of the political situation in Ukraine.
The balance between the tendencies for democracy and dictatorship is
very shaky, said Moroz. The role of power representatives, lawmakers
including, in making either of these tendencies stronger, is obvious,
maintained Moroz.
Commenting on the Cabinet's budgetary policies, Olexandr Moroz
stressed that the governmental debt for state securities totals about
UAH 9.2 billion. In addition, interest and redemption of foreign debt
in 1998 is to cost up to UAH 3 billion. The servicing of the foreign
debt will eat up almost half the budgetary revenues, continued the
former speaker, while the cabinet's reponse to this is running into
new debts, building up new financial pyramids at higher interest
rates. To find the money to repay foreign debts, said Moroz, the
cabinet suggests more cuts in social programs. Moroz emphasized that
Kuchma's yesterday address in parliament did not contain comprehensive
and trustworthy assessment of the real situation in the country.
SIMPLIFIED TAXATION, BOOKKEEPING FOR SMALL BUSINESSES IMPOSED BY
PRESIDENTIAL DECREE
KYIV. On May 12, President Kuchma signed a decree on the state support
for small businesses. The President recommends to allocate 0.5% of
local budget revenues for the support of small businesses, as well as
to simplify taxation and bookkeeping procedures.
In line with the decree, all numerous taxes levied currently on small
businesses are to be replaced with a single tax or, for individual
businessmen, with a patent. Small businesses will also have simplified
bookkeeping. The cabinet of ministers is given two months to prepare a
draft of the law introducing simplified procedures for small
businesses. These procedures will apply for small businesses employing
up to 10 staff, including part-timers and representatives in company
branches, and with the sales of up to UAH 250,000 (about US$ 125,000)
annually.
The decree also foresses the creation of a non-commercial Ukrainian
fund for the support of entrepreneurship which will render support for
small businesses.
NUMBER, STAFF OF UKRAINE's PARLIAMENTARY FACTIONS APPROVED
KYIV. On May 14, the Supreme Council of Ukraine has approved the
number of MPs in, and the list of members of Parliament's factions.
Overall, there are eight factions in the newly-elected Parliament.
The Ukrainian Communist party's faction with Pavlo Symonenko as its
head is the biggest in the Supreme Council; it consists of 119
lawmakers. The People's Democratic party's faction (headed by Anatoliy
Matviyenko) is the second largest one with 84 members and the People's
Rukh's faction with Vyacheslav Chornovil as its leader is the third
largest one with 47 MPs in it. These three largest factions are
followed by the Hromada party's faction headed by Pavlo Lazarenko - 37
lawmakers, the Left-wing Center bloc made up by the Socialist and
Peasants' parties (with Oleksandr Moroz as head) - 35 MPs, the
Social-Democratic party of Ukraine (united) and the Green party - 24
MPs each (headed by Yevhen Marchuk and Vitaliy Kononov respectively)
and the Progressive Socialist party headed by Natalia Vitrenko - 17
MPs.
LEADER OF CRIMEAN COMMUNISTS LEONID HRACH BECOMES HEAD OF CRIMEAN
SUPREME COUNCIL
SIMFEROPOL. Following the secret vote at the closed sitting of the
Supreme Council of Crimea on May 14, Leonid Hrach, leader of the
Crimean communists, was elected Head of the Crimean Parliament. Mr.
Hrach gained 52 votes (to be elected, one needed to gain 51 votes).
His rival, Serhiy Kunitsyn, head of the Krasnoperekopsk Rayon State
Administration of Crimea and head of the experimental economic zone
Syvash, gained 33 votes. After being elected Parliament's Speaker, Mr.
Hrach said in his speech that he will nominate Mr. Kunitsyn's
candidacy for the position of Head of the Crimean Council of
Ministers.
PRESIDENT MAY APPOINT ACTING MAYOR OF ODESA
KYIV. On May 15, on the proposal of Odesa oblast council, the national
security/defense council analysed the present political situation in
Odesa and the possibility of appointing by the President of the city's
acting mayor, pending new mayoral election. The final decision on the
issue is to be taken, following prime minister Valrij Pustovoitenko's
visit to Odesa due May 15.
As has been earlier reported by InfoBank, the March 29 mayoral
elections were won by the incumbent mayor, Eduard Hurwitz. However,
his main contender, the present Odesa governor, Ruslan Bodelan,
appealed the election results in court. A court in the Kirovohrad
oblast invalidated the election results due to numerous violations and
ruled to hold run-off elections. Despite the court ruling, the city
elections commission refused to hold new mayoral elections.
National security council members stressed May 15 that the standoff
between the city and the oblast authorities in Odesa has grown into an
open conflict. The council insists on a reshuffle both in the city and
in the oblast apparat. In a similar situation back in February 1998 in
Yalta, the President appointed an acting city mayor by his decree.
CRIMEAN GOVERNMENT DISSOLVED BY NEW PENINSULA PARLIAMENT
SYMFEROPOL. Late May 14, 58 out of 92 Crimean parliament members voted
to disband the peninsula government headed by Anatolij Franchuk. At
the same time, lawmakers authorized the old government to keep running
the peninsula pending the formation of a new cabinet.
On May 15, the newly elected speaker of the Crimean parliament and
local Communists leader Leonid Hrach left for Kyiv for consultations
with President Kuchma on the new Crimean premier. Speaking to
journalists on May 14, Hrach told he will nominate the city of
Krasnoperekopsk mayor and Sivash pilot economic zone head Serhij
Kunitsyn who is also chairman of the peninsula People's Democratic
party branch.
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