On October 17, Verkhovna Rada considered in the first reading the 2002 budget bill. “The government-submitted draft 2002 state budget is not sufficiently transparent. The document reveals considerable latent financial resources,” Chair of Verkhovna Rada Budget Committee Oleksandr Turhynov declared in his report to lawmakers. Briefing them on the work done by his committee, he noted, “We have prepared proposals to increase budgetary expenditures by UAH 13.9 billion” (a third of the draft budget — Author). The committee proposed including in the budget UAH 5.8 billion revenues from privatization, earmarked by the government to offset the financial deficit and repay foreign debts. “This is where the real surplus was.” In addition, the deputy also proposed including state social funds (except the Pension Fund) totaling UAH 4.7 billion in revenue and expenditure for 2002. A third proposal aimed at increasing revenue by higher than the collection rate set by the government for some taxes and duties, including UAH 810 million in income tax, UAH 150 million in fees for the special use of water resources, UAH 150 million in excise tax, et al. Stressing certain constructive proposals made by the Budget Committee, Finance Minister Ihor Mitiukov said that his ministry cannot agree with such ways of generating more revenue for the budget: “We greatly doubt the possibility of raising revenues by UAH 3.3 billion in domestic taxes and duties bypassing domestic capital markets. The same is true of the income tax.” Meanwhile, the direct inclusion of receipts from the sale of state property “could destabilize the situation,” the minister warned.
Lawmakers showed much more interest discussing budget expenditures, with the Communists and Progressive Socialists engaging in their traditional trashing of the budget’s social programs. While Regions of Ukraine deputies were angered by Deputy Turchynov’s proposal to cut the executive budget by UAH 200 million and that of the State Tax Administration by UAH 95 million. The NDP Solons, whose chair is head of the Transport Ministry, pointed out funding shortfalls for the transport sector.
According to Oleksandr Turchynov, his committee has considered about 1600 proposals made by various parliamentary committees, lawmakers, fractions, groups, the National Bank, local governments, and other budget money recipients, with 1000 of them having been taken into account. Said Turchynov, “Some of the expenditure proposals we have received exceed budget revenues by UAH 100 billion” (executive bodies, for example, demanded a UAH 19.9 billion budget for themselves — Author).
On October 18, Verkhovna Rada voted to return the bill to the commission for revision.
