Lawmakers Kill Parcel Tax Reform, Block Audit Chamber Vote Hours After PM Warns of $27B Defense Gap

Ukraine’s parliament, the Verkhovna Rada, rejected eight bills on Tuesday, Sept. 1, that would have ended a VAT exemption on low-value imported parcels, and separately blocked a vote on launching the selection of six new Accounting Chamber members – both commitments tied to Ukraine’s EU and IMF financing.The votes came hours after Prime Minister Serhii Koretskyi told lawmakers that Ukraine is counting on $30 billion from partners this year, contingent on parliament delivering the reforms it promised.JOIN US ON TELEGRAMFollow our coverage of the war on the @Kyivpost_official.Koretskyi warns lawmakers of a $27 billion defense financing gapKoretskyi told parliament on Tuesday that a government audit found Ukraine needs $30 billion from partners in 2026 if it fulfills its commitments, and faces a separate $27 billion shortfall in defense financing that it is asking allies to cover on an emergency basis. He named two drivers: the rising cost of the war, as Russia expands drone and missile production, and the fact that Ukraine’s Defense Ministry spent part of its second-half 2026 budget in the first half, leaving a gap.“Without addressing these issues, without addressing the deficit, the state could find itself under significant financial risk. This is about supplying the defense forces, financing the social sphere, and paying wages,” Koretskyi said in parliament, Interfax-Ukraine reported.He said the government still had to adopt 44 decisions – resolutions, orders, and other obligations – by Nov. 1. Of 26 bills pending in parliament, only 12 were on the agenda; the other 14 had not yet been included, he said, while the government itself had yet to submit 17 bills it had promised partners, which it now plans to file shortly. Other Topics of Interest Koretskyi Hints at Austerity Measures to Relieve $27B Budget Shortfall The Ukrainian prime minister also called on lawmakers to help approve 44 decisions before Nov. 1 to help unlock international funding needed to cover the $27 billion defense budget gap. Parliament rejects parcel tax bills for the second time this yearLawmakers first declined to advance a related customs bill, No. 15460, which would have set the procedural mechanics – currency conversion rules, marketplace obligations, penalties – for ending the VAT exemption on parcels valued under €150 ($174). It drew 194 votes, short of the 226 needed, and was sent back for rework with 244 votes in favor, Interfax-Ukraine reported.Parliament then rejected the core bill, No. 15112-d, along with six alternative versions, that would have ended the VAT exemption itself. The lead bill got 210 votes, also short of the 226-vote threshold.“Dear colleagues, I’m sorry,” Speaker Ruslan Stefanchuk said from the podium after the vote in parliament, Interfax-Ukraine reported.MP Yaroslav Zheleznyak of the Holos party told reporters the bill would only have taken effect in 2027, and that the Cabinet and State Customs Service had not yet begun developing the technical systems needed to enforce it, with no funding allocated in the state budget, Interfax-Ukraine reported.The Finance Ministry had estimated the reform would bring roughly Hr. 10 billion ($224.6 million) into the state budget annually. Passage was a condition for Ukraine’s roughly $0.7 billion third IMF tranche and the €3.7 billion ($4.2 billion) second tranche of the EU’s €90 billion ($102 billion) Ukraine Support Loan. Under the IMF’s updated memorandum, the bill was due by the end of July – already a revision from an original March deadline. It is now the second time this year that a version of the reform has failed in parliament, after a related bill fell on May 26.The rejected bills would have kept VAT exemptions in place for personal, non-commercial parcels under €45 ($52) sent between individuals, unaccompanied luggage under €150 ($174), and imports of drones and defense equipment.A separate defeat threatens the EU’s Ukraine Support LoanThe same day, lawmakers also failed to approve the creation of an advisory group of experts to vet candidates for six vacant seats on the Accounting Chamber’s supervisory board, according to Interfax-Ukraine.The nomination of experts to the Accounting Chamber’s board selection commission was a condition of the €3.7 billion ($4.2 billion) second tranche of the EU’s Ukraine Support Loan, due under the loan’s memorandum of understanding by August 2026 – a deadline that has now passed. Olena Hrazhdan is the Business Reporter at Kyiv Post, covering Ukraine’s markets, business, and economic policy. While she reports broadly on economic issues, her core focus is banking, finance, monetary and fiscal policy. Olena previously wrote for leading Ukrainian business media and became a Fellow of the International Monetary Fund’s Journalism Fellowship in 2024.