OREANDA-NEWS. March 3, 2010. In January 2010, the State Budget Deficit (BD) amounted to UAH 1.6bn (vs.UAH 1.6bn of Budget Surplus in January 2009). The main drivers of the BD were the decrease in the profit tax (down 29%, y/y in January 2010) and the growth in such Budget Expenditures as State wages (49%, y/y) and social transfers (63%).

Millennium Capital relates BD in January to the Presidential elections, which required significant Budget Expenditures, while the seasonal drop in the January output reduced the profit tax receipts. As Millennium Capital has written earlier, Millennium Capital believes that the State BD 2009 was four times higher than that announced officially (UAH 19.9bn), which will increase the actual State BD to around UAH 100bn, or 10% of GDP in 2010.