The abolition of state regulation of prices: what to expect Ukrainians

The expert criticized the abolition of state regulation of prices.

The abolition of state regulation of prices for food products may actually lead to a sharp increase in the price of these goods, because in Ukraine there are no fuses price fluctuations.

This opinion on his page in Facebook was expressed by Director General of the Ukrainian Association of trade networks suppliers Oleksiy Doroshenko.

“State regulation of prices for social products since July 1 is canceled. This is not to say that once prices start to rise. It says that we have no fuses price fluctuations, which in our country can be measured in tens of percent. By the way, for the same products in developed countries such jumping up and down there. And we have the Ministry of agrarian policy and food constantly indicates that markets have “seasonal price fluctuation”, even when they occur outside of the season,” he said.

According to him, to comply with “European standards”, cancelling one, replace it with another, and in Ukraine this is not happening.

“Therefore, the government was obliged instead of government regulation to enter one of the three systems is inherent in the European Union and the United States. First, if we want to support the market through the manufacturer, increase subsidies. But in this way we make the system opaque, as in Ukrainian conditions the end user will not get the expected reduction in price,” – said the expert.

As for the second option, Doroshenko offers to support the manufacturer because of lower VAT rates for food – the average rate of value added tax in Europe is 5% and is governed by a separate Directive, and in Ukraine it is 20%, so the Ukrainian flour in Poland is cheaper than us.

“And the third option is subsidies on products to consumers. In conditions when there is a base holders, subsidies for housing and communal services, it is a technical issue. In the U.S. such subsidies enjoyed by 20 million people, receiving an average of more than $ 330 per person per month”, – said General Director of Ukrainian Association of suppliers of retail chains.

In his opinion, due to the fact that each of these steps leads either to a decrease in revenues or increase taxes, the Cabinet of Ministers is not willing to consider them.

“That is not a question of European practice, and the desire to support large manufacturers. We understand that when the money goes in the budget, each of us can not control. In the case of reduction of VAT and subsidies on products, every buyer in control of the money, bypassing the state budget. In the case where could not effectively dispose of the taxes collected, they should just reduce it. To transfer the responsibility on the Antimonopoly Committee of supervision of the market conditions in the country, which won the monopoly, is not effective”, – concluded..

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