KUCHMA USING PRESIDENTIAL DECREES TO INTRODUCE REFORMS.

Ukrainian President Leonid Kuchma yesterday decreed a tax reform in favor of small business. The decree introduces a single, fixed tax on individuals engaged in private business and another on firms with a maximum payroll of ten employees and an annual profit of up to 250,000 hryvnyas. The new system, to go into effect on January 1, replaces a multitude of levies on small business. Overall, it reduces tax pressure to approximately one-third of the existing level. (Ukrainian agencies, July 6)

Yesterday’s decree represents Kuchma’s most significant step since his June 18 pledge to introduce reforms by presidential decree, bypassing the leftist veto bloc in parliament. (See the Monitor, June 19) Under the constitution, presidential decrees go into effect within thirty days unless overridden in parliament. However, the parliament is not empowered to pass legally valid decisions until it elects its chairman and other leaders. The newly elected and hung parliament has been unable to do that. The stalemate offers the president a window of opportunity to introduce reforms by decree. He has already issued decrees on simplifying and reducing agrarian taxes and on cutting certain budget-financed social benefits. (Ukrainian Center for Independent Political Research (Kyiv), Research Update, June 29)

RUSSIA’S BLACK SEA FLEET IN UKRAINE CHANGES COMMANDERS.