Shadow economy volume in Ukraine exceeds UAH 1 tn – MP Hetmantsev
The amount of uncollected taxes due to shadow schemes in Ukraine is estimated at over 1 trillion UAH, which creates unequal conditions for competition, in particular in the agricultural sector, retail and processing industries, head of the parliamentary committee on finance, tax and customs policy Danylo Hetmantsev has said on the TAX Podcast.
The lawmaker noted that the key problems of the domestic economy currently remain smuggling, salaries in envelopes and VAT manipulation due to the fragmentation of big business into networks of individual entrepreneurs.
"We have over a trillion hryvnias in the shadows. This money could be used to increase salaries for teachers, doctors and pay pensions. Currently, these funds are actually being laundered from the budget and the army," the MP emphasized.
Getmantsev noted that the practice of using individual entrepreneurs by large retail chains to avoid paying VAT distorts the market environment. As an example, he cited franchise schemes in retail, where cash registers issue several checks: one for alcohol on the general system, and the other, through an individual entrepreneur. According to the chairman of the committee, this gives such enterprises an unfair advantage of 7-20% due to unpaid VAT.
‘‘If we allow the parallel existence of white and black systems within the same jurisdiction, we have no future for normal economic development. This distorts the conditions for fair competition, which affects transparent business,’’ he added.
The chairman of the parliamentary committee also emphasized that de-shadowing the market for excisable goods (fuel, tobacco and alcohol) remains a priority for parliament for 2026. Despite some successes in the fuel sector, a setback was recorded in the tobacco industry at the end of 2025: the share of the illegal market again increased to 18%.
As reported, in 2024, thanks to de-shadowing measures, the state budget received an additional $2.5 billion. Further implementation of the European Customs Code and strengthening control over transfer pricing are planned for 2026.