Abstract
Ukraine's economy, as compared to other European countries, is lagging behind. An unstable political situation, significant tax pressure, various administrative barriers, complexity of tax administration and with obtaining permits, technical regulation, certification and standardization, frequent sudden inspections by state control bodies, limited opportunities for the use of financial and credit resources, weakness of material, technical, financial, managerial, and personnel components of business entities – all these factors do not promote the entrepreneurial initiative in this country. The key precondition for raising the prosperity level and effective social and economic development is strengthening the competitiveness of the national economy through the coordinated work of the state and its budget and fiscal institutions. This study reveals the theory and the methodology of the formation and implementation of fiscal policy in Ukraine. Peculiarities in the development of the entrepreneurial environment in Ukraine are analyzed, and fiscal mechanisms are defined with the purpose of activating further entrepreneurship development.
TopLiterature Review
There is no consensus among researchers concerning the definition of “tax competition”. R. Teaser (2005), T. Field (2003), C. Pinto (2003) and D. Rohas (2006) all considered international tax competition in the broad sense and treated it as inconsistent tax-setting by an independent state, the use of low effective tax rates, and the reduction of tax burden in order to increase the competitiveness of national business, boost business activity in the country and attract foreign investments.
Key Terms in this Chapter
Fiscal policy: A set of measures by which the state influences the economy through the structure of tax revenues to the state budget, directions in public expenditure and methods of attracting the borrowed funds.
Tax Harmonization: The process of adjusting tax systems of different jurisdictions in the pursuit of a common policy objective.
Tax Incentive: An aspect of a country's tax code designed to encourage a particular economic activity.
Tax Competition: A form of regulatory competition which exists when governments are encouraged to lower fiscal burdens to either encourage the inflow of productive resources, or discourage the outflow of those resources. The essence of the concept “international tax competition” is in the rivalry of countries for mobile but limited economic resources using the tools and specific features of national taxation systems.
Tax Burden: The amount of income, property, or sales tax levied on an individual or a business.