₴129 billion of excise tax and rent from the energy sector paid to the state budget in 2024

In 2024, Ukraine’s state budget received UAH 129.44 billion from the energy sector*, of which two-thirds or UAH 86.38 billion came from excise tax payments and another UAH 43.06 billion from rent payments. 

Last year, energy sector taxes accounted for 4.1% of the total state budget revenue. For comparison, in 2023, this amount was UAH 114.73 billion or 4.3% of overall revenues.

According to estimates from the Energy Map open data platform, energy-related revenues increased by 13% or UAH 14.71 billion compared to 2023. This marks the second year in a row since the beginning of the war that budget revenues from the energy sector have grown. However, despite the positive dynamics, they still remain below the pre-war level - in 2021, energy sector revenues reached UAH 134.74 billion.

Fuel excise tax payers paid the largest amount of money in 2024: UAH 66.29 billion for imported fuel and UAH 10.78 billion for fuel produced in Ukraine. UAH 8.43 billion of excise tax was paid for electricity produced in Ukraine, and another UAH 0.87 billion for electricity supplied to Ukraine.

Rent payments for the extraction of energy resources totaled UAH 42.05 billion: 69% from natural gas production (UAH 28.94 billion), 21% from crude oil (UAH 8.89 billion), 9% from gas condensate (UAH 3.84 billion) and 1% from coal (UAH 0.38 billion). Rent for oil and oil product pipeline transportation amounted to UAH 0.76 billion, and UAH 0.18 billion was paid for water use in hydropower.

The largest increase over the year in monetary terms came from the excise tax on imported fuel - revenues from the sale of petroleum products increased by UAH 23.62 billion, or 55%. 

The increase in revenues in 2024 is due to the gradual restoration of pre-war excise tax rates on petrol, diesel and liquefied gas, as well as their further increase in the second half of the year (the first stage in the gradual increase in the excise tax on fuel to the minimum level set by the European Union). At the same time, revenues from the sale of fuel produced in Ukraine decreased by UAH 0.46 billion or 4% over the year, which may be explained by a decrease in fuel production by mini-refineries.

For reference. Following Russia's full-scale invasion, the Verkhovna Rada decided to abolish the excise tax on certain fuels and petroleum products. Starting from 30 September 2022, zero rates were cancelled and reduced excise rates at the level of 100 EUR/thousand liters for diesel fuel and petrol were introduced, while the excise tax on liquefied natural gas was returned to the level of 52 EUR/thousand liters. From 1 July 2023, fuel taxes returned to pre-war levels: excise tax on petrol was 213.5 EUR/thousand liters, diesel - 139.5 EUR/thousand liters, biodiesel - 106 EUR/thousand liters. Starting from 1 September 2024, the new increased tax rates were applied: petrol - 242.6 EUR/thousand liters, diesel - 177.6 EUR/thousand liters, liquefied gas - 148 EUR/thousand liters, biodiesel - 134.95 EUR/thousand liters. At the same time, a schedule of annual increases in fuel excise rates over the next four years has been established.

Revenues from the excise tax on electricity in 2024 increased for both domestically produced and imported electricity. For electricity produced in Ukraine, the increase of UAH 1.69 billion (+25%) was mainly due to higher prices. Thus, the weighted average price on the day-ahead market in 2024 was UAH 4,878.1/MWh (excluding VAT), which is 35% higher than in 2023 (UAH 3,617.6/MWh). Given that the tax base is the cost of electricity sold excluding VAT (3.2% rate), the price increase directly affected the increase in excise revenues. At the same time, according to the law, the excise tax is not charged on electricity from renewable sources.

As for electricity purchased from abroad, revenues increased by UAH 0.69 billion, or 379%, mainly due to a 5.5-fold increase in imports - 4436.6 GWh in 2024 compared to 806.4 GWh in 2023. This growth is driven by the need to cover the electricity shortage caused by large-scale damage to Ukraine's energy infrastructure as a result of Russian attacks.

Among the rent payments, revenues from gas condensate production increased by UAH 1 billion (+35%), oil production - by UAH 0.25 billion (+3%), and oil and oil products transportation by pipelines - by UAH 0.19 billion (+33%).

The increase in revenues from gas condensate production is due to the growth of actual selling prices for oil and condensate: in 2024, the prices ranged from UAH 18.2-22.5 thousand per tonne excluding VAT, while in 2023 they were UAH 12.5-22.1 thousand. The increase in revenues from the transportation of oil and oil products may be caused by the exchange rate changes. The tax rate is 0.56 USD/tonne, while the average dollar exchange rate increased from UAH 36.6 in 2023 to UAH 40.2 in 2024 (+10%), which contributed to the growth of hryvnia revenues to the budget.

The largest decline over the year was shown by revenues from rent for natural gas production (down by UAH 12.3 billion or 30%). The reasons for this include a decline in the actual selling price of natural gas, which is used to calculate the rent for its production. According to the Ministry of Economy data, in 2023, the price ranged from UAH 10.7 to 23.7 thousand/tcm, while in 2024 it was UAH 11.1-15.2 thousand/tcm, due to the overall drop in gas prices in 2024.

The decrease in revenues may also be attributable to the increase in production volumes from wells that were commissioned after 2018. These wells are taxed at a reduced rent rate of 6% or 12% depending on the depth of the well, compared to the standard 14% and 29%.

Revenues from the energy sector in 2023-2024

* Calculations are based on selected budget classification codes 13 (rent and fees for the use of other natural resources) and 14 (internal taxes on goods and services) and do not include penalties, fees for the operation of the gas distribution system, regulatory fees, licence fees, fees for special permits, etc.

The calculations do not include revenues to regional budgets.

Download data on state budget revenues from the energy sector. The dataset contains information on tax and non-tax revenues (rent, excise, fees, charges, etc.) by budget classification codes.

The preparation of this material was made possible thanks to the support of the American people, provided through the United States Agency for International Development (USAID) within the framework of the project “Energy Sector Transparency”, implemented by the DiXi Group NGO. The information presented in this material is the sole responsibility of the DiXi Group NGO and under no circumstances can be considered as reflecting the position of USAID or the US Government.