Ukraine Lawmakers Inch Forward With IMF-linked Bill for Strained Budget

Ukraine Parliament Advances IMF-Linked Reform Bill for War-Time Budget

Key Developments in Ukraine's Legislative Push for Financial Support

By Yuliia Dysa

Parliamentary Action on IMF-Required Reforms

KYIV, April 7 (Reuters) - Ukraine's parliament passed one of a handful of tax laws on Tuesday as part of reforms required by the International Monetary Fund, lawmakers said, with more votes expected on Wednesday as Kyiv needs to secure critical financing.

Missed Deadlines and Blocked EU Loans

Ukraine missed late 2025 and early 2026 deadlines for billions of dollars' worth of support from its key lenders. On top of that, a multi-year 90 billion-euro ($104.17 billion) EU loan is being blocked by Hungary.

IMF Pressure and Budgetary Needs

Relying heavily on external financing for its war-torn economy, Kyiv needs $52 billion this year, and the IMF is pressing it to expand its tax base.

Political Tensions and Legislative Challenges

Disagreements Between Parliament and Government

But parliament is at odds with the government, as some lawmakers accuse Prime Minister Yulia Svyrydenko and President Volodymyr Zelenskiy of poor communication and implementing populist measures that put an additional strain on the budget.  

Extension of Military Tax

Nonetheless, parliament approved a bill that extends a military tax, introduced following Russia's full-scale invasion in February 2022, to three post-war years, opposition Holos party lawmaker Yaroslav Zhelezniak said on the Telegram app. 

Progress on EU-Linked Legislation

Ukraine Facility and EU Funding Requirements

Lawmakers also passed two bills and supported another at the first reading - all addressing requirements for EU funding known as the Ukraine Facility, under which investments are contingent on reforms, and its membership accession process.

Potential Financial Impact

"This is just the start of a voting week that will determine whether Ukraine receives further financial support under the Ukraine Facility," Economy Minister Oleksii Sobolev said on Facebook.

"The passage of these three laws alone would allow Ukraine to count on approximately 1.3 billion euros in funding."

Upcoming Legislation and Ongoing Negotiations

Other bills in line with the IMF demands, such as a contentious one introducing a tax for online platforms, are expected to be reviewed on Wednesday, Zhelezniak said.

The head of the ruling Servant of the People faction and Svyrydenko, as well as the finance minister, held several meetings with members of parliament ahead of the session, aiming to secure their backing, the lawmakers said.

Political Infighting and Future Outlook

The vote underscores the political infighting and mounting challenges for the ruling party to gather enough votes even for critical legislation. By law, Ukraine cannot hold an election until after the war ends.

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(Reporting by Yuliia Dysa;Editing by Alison Williams)