NBU supports lifting 2% forex tax

Thursday, May 26, 2016 - 12:00 (EEST) Section: Latest news

The National Bank of Ukraine (NBU) plans further easing of foreign currency restrictions and supports the abolition of a 2% deduction to the Pension Fund on foreign currency exchange transactions, according to the regulator`s posting on Facebook referring to the chief of the NBU`s open market op`s dept Serhiy Ponomarenko.
According to Ponomarenko, the deductions` volume has no significant impact on budget revenues, instead encouraging ”grey” schemes of forex transactions.
Ponomarenko said that the regulator`s restrictions would be relaxed in a manner that would not undermine the stability of the monetary and foreign exchange markets.
He also recalled that the liberalization of restrictions is linked to the implementation of certain conditions rather than specific dates.
”We are aware of all those challenges for businesses that are caused by a number of restrictions on the foreign exchange market the regulator introduced in 2014-2015. At that time, they were the necessary anti-crisis measures. Currently, the foreign exchange market meets the demand for currency, enabling the NBU to buy foreign currency almost on a daily basis to boost its international reserves,” Ponomarenko said.
As UNIAN reported earlier, the National Bank of Ukraine continued gradual liberalization of temporary anti-crisis restrictions on the foreign exchange market, introduced in 2014-2015. From May 11, it abolished the compulsory sale of currency for implementing foreign investments in Ukraine. Also, the regulator has reduced by one day a period of booking by authorized banks of the hryvnia funds for the purchase of currency on behalf of customers, and now the purchase of currency will be available on the third business day (T + 2 mode).
The regulator announced further easing of administrative restrictions on the foreign exchange market after the resumption of cooperation with the International Monetary Fund. In particular, the regulator announced plans to lift the ban on repatriation of dividends based on the results of evaluation of their volumes.
The current restrictions on the forex market include a limitation on the withdrawal of hryvnias at banks` cash desks and ATMs in the amount of UAH 500,000 (about $19,840 at the current forex rate) in hryvnias and UAH 50,000 ($1,984) in the foreign currency equivalent per one client per day. Individuals are allowed to buy cash foreign currency in the equivalent of UAH 6,000 (about $238) per day. Other restrictions are the mandatory sale of 75% of exporters` foreign currency earnings, a 90-day limit on the return of advance payments on agreements on imports, a ban on early repayments of loans by residents to nonresidents, a ban on the return of investment and transfer of dividends to foreign investors. What is more, Ukrainian banks should secure the NBU`s consent for the purchase of foreign currency if its sum exceeds $50,000 in the equivalent.