Transformation of Fiscal Policy and Fiscal Space under Conditions of Digital Technologies Expansion

The purpose of the article is to study essence of fiscal space and fiscal policy implementation in the context of a global digital economy development trend and formation of a network interactions society. On a basis of scientific publications analysis, the basic approaches to understanding the phenomenon of digital economy and its fiscal consequences were determined. It was found that the digital economy helps to internationalize business, emergence of new financial products and tools, virtualize the financial market, and stimulate the cross-border capital movements in the world. It was proved that global automation and digitalization of financial processes require qualitative changes in fiscal policy. The main problems of innovative digital paradigm of taxation are: deformation of tax terminology, emergence of new objects of taxation, tax base erosion and profits shifting between countries, needs for intergovernmental coordination in fiscal space. World experience that can be used to improve tax efficiency in Ukraine was generalized. Considerable attention to the introduction of value added tax from foreign suppliers of digital goods and services in the OECD countries has been paid. The expediency of its implementation in domestic tax practice is substantiated. The terminology and mechanism of introduction are proposed. The backwardness of the current fiscal space in Ukraine and the traditionality of the national fiscal policy on labor and capital taxation were substantiated. It was proved that the exclusion of new digital objects into tax base, an absence of taxes for electronic goods and services, does not allow to transform fiscal space of Ukraine for public welfare growth. The potential risks and threats as a result of digitalization were emphasized.