Bonuses to Ukrainian soldiers can be reinstated only if VAT raised to 24%, military tax to 4.5% - finance minister

MOSCOW. May 4 (Interfax) - Ukrainian Finance Ministry Sergei Marchenko expects a compromise to be reached at meetings of the Verkhovna Rada's working group with senior military officials regarding the reinstatement of 30,000-hryvnia bonuses to military personnel, as the direct implementation of this measure would require 170 billion hryvni a year.

"It can be done only by amending the budget law - through a rise in taxes, including VAT by 4%, and a three-fold increase in the military tax," Ukrainian media quoted Marchenko as saying during a Business Breakfast broadcast on Wednesday.

It is impossible to finance this additional spending by taking money from other categories, for instance public servants' salaries, because these are "not communicating vessels", the minister said.

Ukraine can finance its military spending only from taxes and its own business, he said.

Marchenko described such an unbalanced proposal as populism, adding that it is up to the country's military leadership - the General Staff and the Defense Ministry - to decide on a system of incentive payments to Armed Forces personnel.