Some budget initiatives approved by the Ukrainian government have worried the International Monetary Fund (IMF). In particular, tax breaks and free rail travel could worsen Ukraine’s already precarious fiscal position.

Bloomberg reported this, citing familiar sources.. IMF representatives expressed their concerns ahead of negotiations on a new four-year loan package worth $8 billion. Mainly, the Fund is concerned about tax benefits, in particular for the processing industry of Ukraine and for self-employed entrepreneurs (PE, or in Ukrainian " The fund fears that this could worsen Kyiv’s precarious fiscal position.

The IMF also made comments regarding the UZ-3000 program, which involves providing Ukrainians with free travel by Ukrzaliznytsia for a distance of up to 3,000 kilometers. The IMF also has other requirements:.

It should be noted that the IMF has expressed concern about tax legislation before. In particular, the topic was raised before the Chairman of the Rada Financial Committee Daniil Getmantsev, as well as Prime Minister Yulia Sviridenko.

When asked by journalists, the IMF said that the new program will focus on “measures to support macroeconomic stability, mobilize domestic revenues, ensure Ukraine’s debt sustainability and preserve external viability.”.

Earlier it became known that the IMF could refuse to provide Ukraine with a loan of $8 billion if the EU does not approve a reparation loan of 140 billion euros from Russian assets. Belgium has the final say, whose refusal blocks a key deal and jeopardizes further international support for Ukraine.

European diplomats and European Commission officials warn that without accepting a reparation loan, the IMF may lose confidence in Ukraine's financial stability. But for the Fund this is a critical factor - the IMF does not lend to countries that do not have clear guarantees of financing for the medium term.

However, during the October meeting of EU leaders, Belgium opposed the initiative, citing financial and legal risks.. It is noted that this decision actually blocked the preparation of an agreement for the December meeting of the IMF, which should determine the further format of support for Ukraine.