Transformation of the Elements of the Tax System of Ukraine in the Context of Harmonization with International Standards

Abstract

The purpose of this study is to identify the most problematic elements of Ukraine’s tax system under wartime conditions and to determine optimal mechanisms for their transformation in the context of meeting integration criteria for the national financial system.

The methodological framework is based on the methods of systematization and classification. The study applies comparative analysis, case study analysis, content analysis of legal and regulatory documents and analytical reports, as well as the logical-structural method to develop recommendations for conceptual approaches to reforming the elements of Ukraine’s tax system under current conditions.

The findings demonstrate that the tax system constitutes a complex set of interrelated elements, and the established cause-and-effect relationships among these elements determine the overall efficiency and adaptability of the system under specific conditions. System synergy is a unique phenomenon shaped by multiple factors and circumstances and cannot be achieved through the application of fixed algorithms. Under wartime conditions, Ukraine’s fiscal and budgetary system has faced a severe imbalance between revenues and expenditures, which has been mitigated primarily through international financial assistance. The liberalization reforms introduced into fiscal legislation were largely a spontaneous response to unfolding events rather than a coherent and constructive policy measure, as evidenced by their near-complete rollback in recent years. Such conservatism and lack of adaptability within the fiscal system threaten the state’s financial stability during full-scale war and undermine the country’s long-term economic development potential, while also risking the emergence of socio-economic tensions within society that run counter to the principles of national unity. Accordingly, based on the synthesis of international experience and the results of the author’s analysis, the study substantiates the need for the gradual introduction of the principle of tax preferentiality across the main categories of taxes within Ukraine’s tax system as a key instrument for resource redistribution in the national financial system, aimed at stabilizing socio-economic development under wartime conditions and balancing the economic activity of business entities.