On June 9, President Kuchma signed a decree ordering the Cabinet to reduce the 1998 budget deficit to 2.5% of GDP. The Cabinet has one month to revise existing excise taxes on consumer goods, including oil products, raise utility fees to their real cost, and draft a program for the demonopolization of state utilities. The Cabinet has two months to draft legislation banning the formation of new companies by debtors and make a list of exports banned from barter deals. The decree forbids additional tax breaks, write-offs, and rescheduling budget or loan payments. The Cabinet has two months to pass and implement a program to cut spending and use the savings to pay back wages. To pay wage arrears, the President also earmarks money from the State Innovation Fund, the road tax, and funds from the sale of state assets. The Cabinet also proposes banning higher salaries for managers at companies with wage arrears and to reduce the Chornobyl Fund and Social Insurance Fund taxes. The Justice Ministry is to propose tougher laws against setting up bogus companies.






