The rich get richer, the poor get poorer. Why does the number of millionaires grow so rapidly during the war, and why are such huge sums still not enough today? AI “FAKT” conducts research and tries to explain it.
For in the words of Danil Getmantsev, chairman of the financial committee of the Verkhovna Rada, in 2023 the number of millionaires in Ukraine has increased significantly. Officially, only 10,700 Ukrainians declared incomes of more than 1 million hryvnias per year.
In Ukraine, the declaration of citizens’ incomes for 2023 was completed, and a total of 172,000 tax declarations were submitted. Ukrainians declared an income of 218.5 billion hryvnias, the number of people who earned more than 1 million hryvnias in 2023 was 10,700, which is 1,200 more than in 2022. Note that this declaration campaign is voluntary, but despite the fact that in 2023, about 9 million people were working and earning in Ukraine, only 172,000 declarations were submitted, which corresponds to approximately 2%. It is obvious that not everyone actually submitted a declaration and not everything was really declared, but in any case it is important to realize that the real number of hryvnia millionaires in our country is much larger than these 10,700 people.
Why is the number of millionaires increasing?
At first glance, everything is quite simple: while the poor bear the brunt of the war, spend their last savings on drones or lose their property in battle, while the military sheds blood on the front, a group of rich people makes unlimited money. War has always made it possible for enterprising people to make huge profits, and this is partially true, because currently Ukraine is in a catastrophically bad state from the point of view of social justice. Thus, a significant part of the population is constantly impoverished, while some citizens have become very rich.
However, the reality is much more complicated: the official list of millionaires included all those who declared their income in 2023 with an income of more than 1 million hryvnias, in other words, if a citizen earned one million for a whole year, he was also included in the number.
Of course, the list includes many others whose incomes range from tens to hundreds of millions. However, since the declaration is voluntary and no one is obliged to disclose corrupt or illegal income, it is mostly “white” money. Therefore, the traditional “military leader Vasyl” and “humanitarian tycoon” with a suitcase of cash are immediately excluded from this list.
Is a million in Ukraine a little or a lot?
An abstract million hryvnias is a large figure for most citizens, but in global terms it is not such a serious amount, for example, the official dollar rate of the NBU is currently 39.77 hryvnias, for ease of calculation we will round it up to 40. This means that one million hryvnia is 25,000 US dollars, which does not look like such a large amount. But what can you buy for this money?
For a million hryvnias, you can buy a car of an average or slightly higher class, but most likely only a used one. To buy a new car of the same class, you will have to pay much more at a car dealership. You can also buy an apartment with this money. But it will probably be quite small, it will be sold on the second-hand housing market, the repairs will be done from the outside, and the apartment itself will definitely not be in Kyiv or somewhere in the west of the country, where it is now quite safe and housing prices are rising. No, of course, for the same money you can get a pretty nice apartment in Kherson or Kharkiv, but hardly many people want to invest in real estate in the frontline cities, where shelling and power outages occur every day.
To accumulate a million in a year, you need to earn about 83,000 hryvnias per month, that is, a little more than $2,000. Let’s be honest – for a skilled IT expert, a medium or small businessman, an international driver or a logistician working for a Western company, this is not difficult money.
The main problems are inflation and devaluation of the national currency. The hryvnia is getting cheaper and cheaper, and this trend will continue, and if the aid from our allies suddenly stops or the exchange rate is no longer supported, then we will also have the opportunity to get into the list of millionaires. But the purchasing power of this money will already be relatively low and will continue to fall. Therefore, there is nothing surprising in the increase in the number of millionaires, and these are not necessarily people who got rich during the war.
So, when there are job cuts, when the average salary of a Ukrainian fluctuates between 12,000 and 15,000, when people lost their homes and property because of the war, it is obvious that in such a situation, the increase in the number of millionaires causes anger and hatred. But here, as everywhere, a correct understanding is required. The number of people in Ukraine with an annual income of more than 1 million hryvnias will continue to grow. however, this is due to difficult economic conditions and does not mean real wealth.
