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Improvement of fiscal efficiency of indirect taxes in Ukraine

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  • Sotnichenko Olena

    (National University of Food Technology, Kyiv)

Abstract

The object of research is the system of indirect taxation, in particular, the mechanisms of administration of indirect taxes. One of the most problematic places is the lack of efficiency of such taxes, affecting the volume of revenues to the Consolidated Budget of Ukraine. Statistical and economic methods are used to assess the fiscal value of indirect consumption taxes in the structure of budget revenues. The analytical method is used when considering the status of indirect taxes for the reporting period (2014–2018), which gave a complete picture of the amount of budget revenues. The main shortcomings of the system of taxation of indirect taxes are identified and substantiated, the most important of which are: reduction of the fiscal sufficiency of the value added tax (VAT) and the imperfection of the system of administration of indirect taxes. Based on the method of comparing the experience of various countries, the main ways of improving tax administration in Ukraine have been formed. As a research result, it is found that VAT is the main one in terms of budget formation. Its share reached the highest level in 2018 (75.1 %). This is due to the fact that since 2016, a 7 % rate on medicines has been introduced. The second in fiscal efficiency is the excise tax, which tended to increase from 22.9 % in 2014 to 24.3 % in 2017. The third indirect tax is the duty: its share in 2014 was 6.4 %, decreasing to 4.7 % in 2018 Thanks to the research, it is established that the level of fulfillment of indirect taxes in Ukraine did not meet the planned indicators. This demonstrates the need to improve the functioning of the tax system. This result can be achieved by reducing the list of preferential VAT transactions and improving the customs legislation of Ukraine in accordance with international standards. The use of foreign experience in the regulation of Ukrainian indirect taxation will contribute to the stabilization of economic growth and the gradual integration of the state into the European community.

Suggested Citation

  • Sotnichenko Olena, 2019. "Improvement of fiscal efficiency of indirect taxes in Ukraine," Technology audit and production reserves, 3(47) 2019, Socionet;Technology audit and production reserves, vol. 3(4(47)), pages 45-50.
    • Handle: RePEc:nos:yttutd:7
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    File URL: http://journals.uran.ua/tarp/article/view/171683
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    References listed on IDEAS

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    1. Hao Wang, 2018. "Optimal Indirect Taxes and Subsidies under Imperfect Competition," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 174(2), pages 334-350, June.
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      Keywords

      effective budget replenishment; indirect taxes; budget revenues; value added tax; tax system;
      All these keywords.

      JEL classification:

      • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

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