Ukraine may introduce a reduced rate of value added tax (VAT) on certain categories of food products, head of the Servant of the People faction David Arakhamia has said.

"I think that in some form such a bill will still be approved ... We will look for compensators for potential budget losses, look for a balanced solution. But something needs to be done, since from July 1 the entire EU, not only Poland, introduces preferential VAT rate for foodstuffs," he said on the Rada TV channel on Thursday.

At the same time, Arakhamia specified that this initiative may be of interest in the context of another draft law – on internal trade.

"It turned out that 27-30% of the price is not the cost, but the influence of the supermarket. Supermarkets delay the return of funds to manufacturers for 120-130 days, and they are forced to apply for loans from banks and put interest on these loans into the cost of their products. Thus, there is an increase in prices," Arakhamia noted.

The MP specified that the initiative to reduce VAT is being discussed by the President's Office, specialized associations, the Ministry of Finance, the State Tax Service, and the relevant committee.

At the same time, during a roundtable talk at the Chamber of Commerce and Industry on the same day, Head of the Committee on Finance, Taxation and Customs Policy Danylo Hetmantsev noted that, according to the Ministry of Finance, the reduction in the VAT rate would lead to losses of the state budget by UAH 60 billion.

"Reducing the VAT rate will not affect the price of goods, since we have a large share of the shadow economy," Hetmantsev said.

In turn, Arakhamia noted that, given the potential budget expenditures, from such an initiative, the parliament may introduce a reduced VAT rate not for all food products, but for a limited amount.

"We need to take a balanced approach to the development of such a bill, introduce a reduced rate not on all goods, but on a limited basket of consumption. Perhaps bread, buckwheat, butter," he said.