Economy

The Temu Tax and the Taxation of Digital Platforms: What Ukraine Must Do in Exchange for IMF Funds

Claims that the IMF is forcing Ukraine to adopt unpopular decisions are, for the most part, misleading. Most of the Fund’s demands concern anti-corruption measures and reforms that are in Ukraine’s own best interest. Economist Oleg Getman made this statement in an interview with the YouTube channel "Komersant Ukrainian".

According to the economist, a significant portion of the international partners’ demands concern systemic changes—the fight against corruption and the reform of state institutions. In particular, it is under pressure from the IMF that Ukraine is pushing forward with a customs overhaul, and the reform of the Bureau of Economic Security (BES) has already taken place.

“The vast majority of the IMF’s requirements are positive, beneficial anti-corruption measures or institutional reforms,” he emphasizes.

Getman also discussed several tax changes that he considers beneficial for the Ukrainian economy.

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Specifically, this involves introducing a taxation system for foreign marketplaces, which is intended to level the playing field between Ukrainian producers and imports.

“When there is no VAT on Chinese goods—from ‘Temu,’ ‘AliExpress,’ and so on—but there is VAT on identical Ukrainian goods, this distorts competition and destroys our manufacturers,” the economist says.

Also, according to him, the initiative to bring hundreds of thousands of self-employed workers into the formal economy through the taxation of digital platforms is a positive step.

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Separately, Hetman commented on the widespread claim that the IMF is allegedly forcing Ukraine to raise tariffs. According to him, the Fund does indeed insist on reducing the budget deficit, but the specific ways to achieve this are decided together with the Ukrainian government and are not disclosed.

“The IMF’s broad requirement has always been—and remains—that we collect as much revenue as possible, expand the tax base as much as possible, and reduce those tax breaks that harm the budget,” he concluded.

Thus, some of the statements about “IMF demands” may be nothing more than political rhetoric; however, in most cases, these are agreements that Ukraine voluntarily undertakes in exchange for financial support.

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