The Ukrainian government has proposed that the single basic rate of 20% for four key taxes – value added tax, single social security tax, individuals' income tax and profit tax – should be introduced, Ukrainian Prime Minister Arseniy Yatseniuk said on television late on Sunday.

The information and public relations department of the secretariat of the Cabinet of Ministers reported that Yatseniuk said that at present, there are 90 types of various rates in Ukraine.

"On one hand, this allows unfair taxpayers to manipulate with the rates, and on other hand, tax inspectors to abuse power during the accruing of taxes," he said.

The introduction of basic rates for key taxes on the one hand sets parity of tax payment rules, and on the other hand it allows for balancing the budget, he said.

He said that at present, the budget fulfills the function of economic stimulation, although in the future budget expenses are to be reduced by as much as possible.

"We're doing this. Every year we gradually would reduce national budget expenses and thus, we could cut the tax rate," he said.

Yatseniuk said that "we cannot reduce social standards."

"We have a large social burden. I understand how difficult the situation is for Ukrainian families. That is why social protection and social standards are not to be simply retained, but they are to be increased. This directly and indirectly links to the tax system and the increase of payments to the national budget," Yatseniuk said.

He also said that there is an extremely large burden on salaries, which is the reason of salaries remain in the shadows.

"From 2018 we propose that the single tax on wage of 20% is set. For the transition period we propose that the single social security tax is cut from 41% to 20%, and tax on salaries of 3.6% paid by employees is revoked," Yatseniuk said.

The government proposed that minimum wages are exempted from taxation to protect the most vulnerable in society,

Yatseniuk added said that the simplified taxation system would not be changed.