The National Bank of Ukraine (NBU) remains opposed to increasing the bank profit tax in 2024 from 25%, to 50% and will continue to convince the Verkhovna Rada, which approved it in the first reading this week of the resource bill No. 11416-d, that such a step is wrong.

"The first reading (…) brought us the decision that it brought. We will try to communicate with the Verkhovna Rada and convey our positions to them accordingly. But we must understand that decisions are made in the Ukrainian parliament," NBU Governor Andriy Pyshny said at a briefing on Thursday.

Among the disadvantages of such an increase, he named the risks of increasing the purchase of government bonds, the likelihood of additional capitalization of a number of state-owned banks, a discriminatory approach to banks and a demonstration of the instability of Ukrainian legislation.

The NBU governor said raising the bank profit tax to 50% could call into question the further growth of lending.

"This time [unlike a similar step in the autumn of 2023] we see the taxation of banks at an additional rate of 50% as a step that may have more risks and more harm than good," he said.