(Kyiv) – Ukraine’s water supply and sewage companies have accumulated nearly ₴1 billion in tax debt, according to a report from the Ukrainian association “Ukrvodokanalekologia.” The association’s director, Oleksandr Shkyn, explained that the debt mainly consists of Value Added Tax (VAT) and special taxes.
In addition to the tax debt, the water utilities are also facing approximately ₴2 billion in loans from the World Bank. Despite these financial challenges, the gross income of all water and sewage enterprises in Ukraine amounts to around ₴35 billion.
Shkyn further revealed that the current tariff rates for water services only cover 70% of the cost of providing these services. This shortfall is contributing to the financial difficulties faced by these essential utilities, which are struggling to maintain operations while dealing with mounting debts.
On December 10, the Ukrainian government approved criteria that would allow for the restructuring of debts for both heat supply companies and water utilities. The restructuring will apply to companies whose infrastructure has been damaged or destroyed by the ongoing war, as well as those located in active conflict zones.
| Debt Category | Amount (₴) |
|---|---|
| Tax Debt (VAT, Special Taxes) | ~₴1 billion |
| World Bank Loans | ~₴2 billion |
| Gross Income (Water Sector) | ~₴35 billion |
| Tariffs Coverage of Service Cost | 70% |
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