Ministry of Finance on transportation tax of 15% of the value: "Buying a car in the war is not a critical need"

The Ministry of Finance believes that the 15% military tax on the cost of vehicles during their initial registration will not pose problems for buyers or the automotive market as a whole. Furthermore, law enforcement is expected to combat the market's potential informalization, which critics have predicted.

“We have a safety issue; a house is on fire, and you suggest not buying extinguishing equipment, but rather purchasing a car. Sure, buy a new car, but also contribute additional support to the Armed Forces,” said Finance Minister Sergey Marchenko in an interview with RBC Ukraine.

He added that purchasing a vehicle in a wartime country is currently “not a critical necessity”:

“Buying a car is not viewed as an urgent critical need right now. However, for the security and defense sector, vehicles can be imported without duties and VAT.”

According to a bill submitted by the Cabinet to the Rada on July 18, the proposal includes increasing tax revenues to 140 billion UAH by raising the military tax rate to 5% (currently 1.5%) and requiring individual entrepreneurs of the third group to pay a 1% tax. Additionally, the bill proposes revising excise duties and implementing a 15% military tax on the first registration of passenger cars.

Previously, the Chairman of the Budget Committee of the Verkhovna Rada, Roksolana Pidlasa, stated that if taxes are not raised, military personnel risk being left without support as soon as the end of September.

Meanwhile, Marchenko reminded that Ukraine spends 166 billion UAH monthly on security and defense, averaging 5.6 billion UAH daily.