Ukraine counts its millionaires (07/21/02)

Ukraine counts its millionaires

by Roman Woronowycz
Kyiv Press Bureau

KYIV - Ukraine has at least 160 millionaires and could have as many as 1,700, reported State Tax Administration Chairman Mykola Azarov on July 17. Although in dollar terms their worth would only be one-fifth of that symbolic threshold of wealth because the value of the Ukrainian currency is only 20 percent of the dollar, nonetheless, it is a rise of at least 260 percent over 2000, when the country's tax police received income reports of more than 1 million hrv from only 62 Ukrainians.

He noted that the highest reported income was 40 million hrv. Ten individuals declared incomes of more than 10 million hrv, and 263 showed incomes topping 5 million hrv.

Mr. Azarov implied that last year's numbers, while a large increase over prior filings, are still inaccurate. He said that last year nearly 1,794 entrepreneurs reported economic activity in which they made profits of more than 1 million hrv.

Mr. Azarov explained that Ukraine's richest contribute the least to the country's coffers because they are not taxed on capital gains made from sales of dividends, shares and real estate. He said that a large number of the rich pay taxes on only 1 to 3 percent of their annual income, which is the salaried portion they report. Meanwhile, people making 400 hrv or less account for 80 percent of the personal taxes collected in Ukraine.

Ukraine's top tax man also noted that stragglers who have failed to file income reports have until September to do so before his agency begins to bring charges against them. He noted that three millionaires who have failed to carry out their civic responsibility are already under investigation and charges could soon be forthcoming.

Mr. Azarov also identified pop music stars and celebrities in general as those most often among the delinquent. In contrast, 97 percent of the general moneymaking population filed income declarations in 2001.

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