Instruments for minimizing the tax burden in Ukraine: comparative analysis and application effects

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Instruments for minimizing the tax burden in Ukraine: comparative analysis and application effects

Journal Title: Економічний аналіз - Year 2018, Vol 28, Issue 4

Abstract

Introduction. The level of the tax burden in Ukraine remains one of the highest in the world. It is a threat to the stable functioning of economic entities and the development of the business sector. The current state of development of tax legislation in Ukraine does not stimulate economic entities to legalize their activities and to legalization their financial flows. The complexity and internal contradiction of legislative acts, the peculiarities of the calculation and payment of taxes affect the decision-making of economic entities on tax evasion. In the context of the growing need to increase tax revenues to budgets of all levels without the use of additional tax pressure, identification of all possible schemes for minimizing tax payments and eliminating the conditions for their use are the most important tasks of the tax system. Purpose. The article aims to investigate modern instruments for minimizing tax burden by economic entities and determining the effects of their application. Results. According to the results of the study, the main causes of tax evasion, methods and mechanisms of using the instruments of minimizing the tax burden have been determined. The effects of their application have been investigated. The analysis of the most common schemes for avoiding taxation has been carried out. It is established that most of them are based on the imperfection of the existing simplified taxation system. The results of the study have showed that the use of instruments for minimizing tax burden leads to a reduction in fiscal flows, a deterioration of the economic environment, the emergence of negative macroeconomic effects. Among the negative macroeconomic effects, we can distinguish the following ones: the deformation of the balance of payments, withdrawal of capital from the country, the formation of additional pressure on the exchange rate, destructive impact on the formation of multi-sectoral priorities of customs and tax policy of the country, deepening of corruption schemes. The necessity of development and application of effective tools for counteraction to tax evasion for timely identification of the unlawful actions of business entities has been proven. It should be done with the aim to increase the level of financial security and to strengthen the competitiveness of Ukraine's economy.

Authors and Affiliations

Inna Tiutiunyk, Iana Kobushko

Keywords

minimizing the tax burden. payment of taxes. schemes and instruments for tax evasion. economic entities. offshore zones. export-import operations. shadow economy.

EP ID EP523540
DOI -
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