Competitiveness of Ukraine’s system of taxation within the framework of integration into the European Union

Abstract

The article reveals the essence and role of competitiveness of the taxation system taking into account retrospective trends and current aspects. In addition, it provides insight into main ways in which tax competition may be manifested. Specific features and methods for deter mining the level of development of the tax system as well as the level of economic freedom are highlighted. The positive and negative influence of globalization on the taxation system of the country is generalized. On the basis of the analysis, carried out for the research, it is found that Ukraine’s system of taxation and the level of economic freedom rank far below the EU countries. Consequently, possible causes of slow progress in Ukraine’s system of taxation are systematized, and its weak position in the international ranking is explained. It is determined that the low-ranking position of Ukraine has been caused by considerable corruption at all levels of executive power, low protection of property rights and weak development of investment. The major factors that negatively affect the business environment are as follows: unstable tax legislation, time-consuming tax accounting, a high overall tax burden and its unequal distribution among taxpayers, improperly adjusted tax reliefs, and mainly fiscal nature of the taxation system. A particular attention is paid to the priorities of the taxation system in European countries. The main guidelines for reforming the national tax legislation, based on the analysis of the latest trends of tax changes in the EU, are determined.