Pension tax on sale of cash foreign currency of 10% is optimal, says NBU

Kyiv, December 13 (Interfax-Ukraine) – The National Bank of Ukraine (NBU) has said that the introduction of the 10% pension tax on the sale of cash foreign currency is optimal, the chairman of the NBU Committee for the Prevention of Dishonest Currency Transactions, Yuriy Horshkov, has said.

"The initially proposed 15% [pension tax on the sale of cash foreign currency] could have been too much. People started being upset at such a large rate. We decided to cut it, as we understand that its economic feasibility starts from 10% - 10% is an even more balanced figure than 15%," he said at a roundtable entitled "The Taxation of Currency Operations: Rates, Transition Period, Introduction" held at Interfax-Ukraine on Thursday.

He said that the size of the pension tax from the sale of cash foreign currency was reduced to 10% in new wording of the draft law after additional consultations with experts and the tax service.

Horshkov also said that the introduction of this pension tax will help fully exclude the speculation component from the structure of the currency market, and the hryvnia exchange rate will realistically reflect the situation in the economy.

"I hope that the draft law will be discussed by the Ukrainian parliament in the next few days," he added.

President of the Ukrainian Analytical Center Oleksandr Okhrymenko said that the necessity to introduce a fee from the sale of cash foreign currency emerged a long time ago.

"The tax should have been introduced earlier: we would not have had such high dollarization," he said.

The head of the analytical department of Investment Capital Ukraine (ICU), Oleksandr Valchishen, said that the draft law foreseeing the introduction of the 10% tax on the sale of cash foreign currency will be supported by lawmakers.

"Many countries have strong positions on their national currency's functioning regime. I think that the fact that Ukrainian authorities are moving in the same direction should find support of opposition parties," he said.

As reported, a bill on the introduction of a fee to the Pension Fund from the sale of cash foreign currency set at 15% of the sum of a deal was registered in parliament in November 2012. Parliament postponed the discussion of the draft for an indefinite period. Later, the NBU proposed to reduce the fee to 10%.