UDC 336.22(477)
Karlin, M. I. (2015). Vstanovlennya stavok osnovnykh podatkiv v Ukrayini na osnovi pryntsypu prohresyvnosti [The need of taking into account the progressivity principle in determining the basic tax rates in Ukraine]. Rehional'na ekonomika - Regional Economy, 78(4). [in Ukrainian].
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Authors

Resume

The article deals with the main disadvantages of the projects for reforming tax system of Ukraine, suggested by both the Ministry of Finance (project of N. Yaresko), and the Verkhovna Rada (project of N. Yuzhanina), because they emphasise the proportionality in taxation. The author substantiates the need for the progressive principle of taxation, including income tax through the use of three rates of value added tax (VAT) and two rates of corporate income tax (CIT). He also proves the need for a gradual reduction of the unified social contribution (Single Contribution) with a lag of five percent annually to 20%, so as not to cause crisis-filled state funds. The suggestions are based on the author’s research of taxation legislation in developed countries, which have long abandoned the flat tax as the income of individuals and legal entities. In addition, there is a requirement to use a few rates of value added tax in the EU, which is still not allowed in the analyzed projects. The main disadvantage of projects of Jaresko N. and Yuzhanina N. is orientation at neo-liberal values upon which the developed countries have begun to give up, moving to an economy built on a synthesis of liberalism and social democracy. In addition, these projects are aimed to improve the financial condition of primarily large enterprises (including foreign capital) while increasing the tax burden on small business and individuals. This redistribution of tax burden can cause social protest, so these projects should be improved by introducing the principle of progressivity in taxation, especially concerning personal income. The increase of tax burden on the income of wealthy people is necessary to be exercised not only by extending the lag between the income tax rates but by increasing indirect taxes on prestige goods and products related to leisure, tourism, entertainment and more.

Keywords:

principle of fairness in taxation, progressivity in taxation, European Union, Slovakia, Ukraine, tax amnesty, Donbass, Small Tax Code