DIGITALIZATION OF UKRAINIAN TAX ADMINISTRATION IN THE CONTEXT OF ECONOMIC CHALLENGES

Abstract

Introduction. Tax administration should be viewed as a comprehensive organisational and functional system that enables the state to perform its fiscal functions. Against a backdrop of military and economic challenges, the growing volume of information and the increasing complexity of financial and business transactions, the demands on the efficiency, speed and transparency of tax procedures are rising. In such circumstances, the introduction of digital technologies aimed at automating tax information processing, improving the quality of tax control and enhancing interaction between tax authorities and taxpayers becomes of paramount importance.

Purpose. A comprehensive analysis of the current state of digitalisation of tax administration in Ukraine in the context of economic challenges, an assessment of its effectiveness, and the identification of priority areas for further development.

Materials and methods. The study was based on Ukrainian legislation and regulations in the field of tax administration and the digital transformation of public administration, official statistical and analytical materials from the State Tax Service of Ukraine (STS of Ukraine), the Ministry of Finance of Ukraine, international recommendations of the Organisation for Economic Co-operation and Development (OECD), as well as academic works by domestic and foreign scholars devoted to the issues of digitalisation of tax administration, tax risk management and the implementation of digital technologies in the sphere of public finance.

A range of general scientific and specialised methods was employed in the course of the research. In particular, the method of theoretical generalisation and systematisation was applied to examine the essence of the digitalisation of tax administration and to identify its key characteristics; comparative analysis – to assess the current state of digital reform implementation in the tax sector and summarise international experience; statistical and dynamic analysis – to evaluate key indicators of digital service development and identify trends in the digital transformation of tax administration in Ukraine in 2022–2024; tabular and graphical methods – to present the research results visually; scientific modelling method – to develop proposals for improving tax administration through the integration of artificial intelligence technologies.

Discussion. It has been established that the key components of digitalisation are the automation of tax procedures, the development of electronic document management, the creation of integrated information systems, the application of data processing algorithms, and the establishment of a digital environment for tax control.

Key reforms in the field of digitalisation of tax administration have been examined, including the introduction of electronic auditing, which involves the use of standardised data formats for the automated analysis of taxpayers’ financial information; and electronic excise duty, as a system for tracking alcohol and tobacco products from the manufacturer or importer to the end consumer.

The study examines tax administration approaches, including the automatic generation of tax returns based on pre-filled tax return forms, which simplifies the reporting procedure and reduces the risk of errors; the automation of desk audits; and the development of electronic services for taxpayers.

An analysis was conducted of the dynamics of key indicators of digital technology integration within the State Tax Service of Ukraine (STSU) in 2022–2024, which demonstrated a gradual increase in the number of users of electronic services, the expansion of the taxpayer’s electronic office capabilities, an increase in the proportion of reporting submitted electronically, and the intensified use of software cash registers.

The paper also examines the development of reforms to automated tax risk management systems, the key element of which should be compliance risk (CRM/UKR), the development and implementation of which will enable risks to be classified (categorised) according to the probability of their occurrence on a scale of high, medium or low levels for each of the compliance pillars, and strategies to be developed to mitigate (minimise) the consequences associated with the identified risk.

Results. In further research aimed at the continued development of digital technologies in the tax sphere, it is proposed to improve tax administration in Ukraine through the use of artificial intelligence technologies, which will contribute to enhancing the effectiveness of tax control, optimising resources and improving interaction between the state and taxpayers.

Furthermore, as a promising direction for the digitalisation of tax administration, it is proposed to focus on the development of automatic international exchange of information in accordance with the CRS standard, the implementation of which provides access to financial information on residents’ accounts abroad and expands the possibilities for detecting undeclared income.