European Integration as a Determining Factor in the Transformation of Ukraine’s Fiscal Policy

Анотація

This article highlights the impact of European integration on the transformation of Ukraine’s fiscal policy. It is argued that the fiscal policies of European Union member states and candidate countries are underpinned by the principles of transparency, predictability, accountability, and medium-term planning, which should also become fundamental to Ukraine’s public finances. It is demonstrated that, in the context of an active phase of war, Ukraine’s fiscal policy performs not only a regulatory but also a critically important stabilizing function, as it must simultaneously ensure funding for defense, social protection, infrastructure reconstruction and the maintenance of macro-financial stability. The analysis covers the evolution of EU fiscal rules from the classic Maastricht criteria to the new economic governance architecture, which is based on national medium-term structural fiscal plans and control of net primary expenditure. It has been established that the current model of budgetary and tax coordination in the EU is more flexible than the previous one, which creates for Ukraine not only obligations but also an opportunity to adapt national fiscal policy to strategic development goals. It has been demonstrated that the key areas of fiscal and tax reform for Ukraine are the harmonization of indirect taxation, the implementation of European requirements regarding VAT and excise duties, the enhancement of tax transparency, the digitalization of tax administration, and the introduction of e- audits and the automatic exchange of tax information. The main challenges of this process are identified: structural asymmetry in the tax system, institutional and administrative barriers, and the conflict between the EU requirements for free competition and the Ukraine’s need to stimulate reconstruction. It is concluded that European integration is the main determinant of the modernization of Ukraine’s fiscal and tax policy and an important instrument for creating the conditions for post-war economic recovery and long-term financial stability.

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