Ukrainian Rise in Consumer Prices, One of Lowest in Europe
OREANDA-NEWS. February 29, 2012. In Ukraine, there are sufficiently low consumer prices for the population and simultaneously low tax rates for citizens. These conclusions follow from ratings of the Centre for Economic Research "RIA-Analysis."
Thus, according to researching, based on official sources, the rise in prices for foodstuff in Ukraine is among the lowest in Europe. Ukraine - one of three European countries where practically there was no rise in price of foodstuff.
In December 2011 food prices have grown by 0.7 percent against December 2010, thus as a whole consumer prices rose by 4.6 percent. During this period, greatest surged food prices in Belarus - more than 2 times. In Turkey, the growing cost of food amounted to 12%, in Russia - 2.4%. Among the European countries the most loyal to the consumers compared to Ukraine were prices only in Sweden and Norway.
But the cost of electricity for the population in Ukraine generally is the lowest among 37 countries for which research was conducted. Moreover - this figure is five times lower than the average for referred rating. But residents of Denmark and Germany pay for electricity about 10 times more than Ukrainians.
Despite rather high cost of imported gas, which is much higher for Ukraine than in many EU countries, the price of natural gas for the population in our country, thanks to the Government efforts, is one of the lowest among our neighbours. Thus, among the 32 countries those were studied during this research, the value of "blue fuel" for the population in Ukraine is approximately six times smaller than average index of rating. And comparisons, for example, with Sweden or Denmark Ukrainians generally pay for gas 13 times less!
Despite all complaints of car owners toward expensive fuel, its cost in Ukraine is still enough low compared to prices in other countries: in December in terms of the price of gasoline A-95 Ukraine took the 29th place among 32 countries for which there has been composed rating. We have a litter of petrol cost at USD 1.28, while the average for sampling of countries this price equalled USD 1.74. The most expensive is to travel in Norway where in December 2011 car owners had put from a purse of USD 2.30 per litter, in Italy - USD 2.17, in Greece - USD 2.13.
But the rates for taxes in Ukraine are sufficiently low. For example, the income tax rate in Ukraine at the time of the survey and research works was 23 percent (17-18 Ukraine's place in the rating of 37 countries), while in France they are paying 34.4%, in Belgium 34%, in Germany 29.8%. Another tax - personal income is also enough democratic in Ukraine – 15%. This is despite the fact that even in 29 countries from 37 that we have studied, citizens pay from their profits much more than Ukrainians. Thus, in Sweden, to the state they give even 56.4% of their income, in Belgium - 53.7%, in France - 46.7%. Thus, according to this research, average index of the tax rate on personal income (33.2%) more than twice as Ukrainian.
It should be emphasized more rather important indicator for the country - the ratio of debt to gross domestic product. Among the countries in terms of debt burden, Ukraine ranks 48th place among 98 countries (in a publication there is data for 2010). Our ratio of debt to GDP is 40.5%, whereas, for example, in Japan 220.3%, Greece - 142%, Italy - 119%, the USA - 91.6%, France - 84.3%.
The expert on economic issues Victor Lisitsky in comments to the UKRINFORM News Agency noted we have low rise in consumer prices thanks to a rigid policy of the NBU. "The policy of the NBU is tough and pragmatic. It has kept especially a rise in prices," said the expert.
However, he recalled about the rise in disposable incomes. "I have impression the incomes of small businesses are growing rapidly, higher than wages" said Mr. Lisitsky. Besides, he added that Ukrainians only should be glad that the level of taxation of individuals is the lowest among European countries.
At the same time, the expert stressed that the low electricity tariffs indicates about Government efforts to keep citizens from further impoverishing. "We – a poor country, and maintaining low electricity rates is a means of keeping from the impoverishment of the population. To increase tariffs to economic levels it is impossible now," emphasized the expert.
He also noted that low gas prices for households are pointing about the unresolved issue of negotiations with Russia. "I would not rejoice low price of gas, it will nevertheless rise. That the President of Ukraine has enough the courage to restrain this problem - this is good, but how to solve it - is unclear. The price of gas still needs to be raised," said the expert.
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