Problems of preserving Ukraine's fiscal sovereignty under war conditions

Анотація

This article examines the challenges of preserving Ukraine's fiscal sovereignty during wartime, highlighting the key threats to budget and debt stability and assessing the extent of the country’s financial dependence on external funding. A systematic analysis of the structural components of fiscal sovereignty is conducted, including tax autonomy, debt burden, external financial influences, and macroeconomic risks. The necessity of quantitatively assessing the level of fiscal sovereignty as a tool for shaping effective fiscal policy in conditions of high economic and political turbulence is substantiated. The objective of this study is to analyse the key threats to Ukraine’s fiscal sovereignty during the war, conduct a quantitative assessment of its level, and determine strategies for its reinforcement through the optimization of tax, debt, and budgetary policies. Methodology. Economic and mathematical modelling is used to construct and calculate Ukraine’s Fiscal Sovereignty Index (FSI). A systematic approach is applied to analyse the interrelations between tax, debt, and budgetary policies. Correlation and regression analysis is employed to assess the significance of macroeconomic and political factors affecting the country’s fiscal independence. Results. Critical threats to Ukraine’s fiscal sovereignty have been identified, including the high dependence of the budget on external loans and grants (up to 56% in 2022), a decline in tax autonomy (with tax revenues accounting for only 45% of budget revenues in 2023), and an increasing debt burden (with public debt exceeding 90% of GDP). The proposed FSI model enables a quantitative assessment of the country’s fiscal autonomy, with its application demonstrating a significant decline in Ukraine’s fiscal sovereignty during periods of economic and political crises. Based on the obtained results, recommendations have been developed to strengthen fiscal sovereignty by improving tax policy efficiency, reducing debt dependency, and expanding fiscal space.

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