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Infrastructure Ministry proposes to raise rail traffic tariffs for first class goods by 9% from 2022

KYIV. Sept 14 (Interfax-Ukraine) – The Ministry of Infrastructure of Ukraine is initiating the second increase in tariffs for freight rail transportation of first class goods, according to the agency’s website.

According to the ministry, a change in the level of tariffs for the transportation of goods of the first tariff class (iron ore, coal, mineral fertilizers, cement, etc.) will reduce the disproportion between the levels of tariff classes of goods, and will also improve the tariff policy on railway transport.

According to the report, it is planned to increase the level of tariffs for the transportation of a group of goods of the first tariff class by 9% from January 1, 2022 by applying a coefficient of 2.204, while the current coefficient is 1.831.

"The adoption of this decision is the next step towards eliminating the distribution of the cost of transportation by tariff classes of goods provided for by the strategy of Ukrzaliznytsia for 2019-2023," the ministry said.

The department explains this decision by the need to eradicate violations that were revealed by the State Audit Service based on the results of the audit of Ukrzaliznytsia for the period from January 1, 2017 to June 30, 2020, when the company lost about UAH 17.6 billion due to the fact that the previously valid tariffs were economically unjustified.

According to the service, one of the lowest coefficients was applied to the tariff for the transportation of iron ore and coal, despite the fact that the cost of transporting these goods is approximately the same as for grain, for the transportation of which a larger coefficient was used.

In this regard, the service proposed to the Cabinet of Ministers to instruct the Ministry of Infrastructure to develop and introduce unified and economically justified tariffs for the carriage of goods by rail.

It is expected that this initiative of the ministry will reduce the difference between the average level of tariffs for the carriage of goods of the first tariff class.