The legislation is part of a peace plan signed with pro-Russian insurgents on September 5 aimed at ending five months of bloody conflict.
Under the proposals unveiled by Poroshenko on Monday, the rebel-held Lugansk and Donetsk regions will be granted broader autonomy for three years.
They will also be able to use Russian in state institutions and conduct local elections on November 9, according to media reports.
The bill also promises to help restore damaged infrastructure and to provide social an economic assistance to particularly hard-hit areas.
Poroshenko's website said Monday the proposals would pave the way for decentralisation while guaranteeing "the sovereignty, territorial integrity and independence of our state".
Another draft bill was submitted on Tuesday to grant amnesty to "participants of events in the Donetsk and Lugansk regions" -- appearing to apply to both the insurgents and Ukrainian government troops.
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