Expert Commentary: Three Times Less Taxes


Iuliia Shybalkina on the announced by the government decrease of taxes: “Large number of taxes is a feature of the countries with the low level of economic development. This way these countries compensate the weakness of their taxation base, caused by considerable shadow sector and large number of social exemptions. Countries, which put their feet on the way of transformation, surely come to the conclusion of the necessity of taxes’ number reduction.

First, administration of a large number of taxes is expensive.

Secondly, it is hard to estimate their influence to the economy.

Thirdly, large number of taxes creates favorable conditions for corruption.

For example, Poland collects twelve taxes, and Georgia collects six.

Analysis of tax revenues to the budget points to the fact that there is a significant potential of decrease of number of taxes in Ukraine. Four taxes out of existing 22 bring nearly 80 of total revenue. Value-added tax, tax on income of private persons, tax on the enterprises’ income and excise are at the top of the list”.

Original publication can be found here (in Ukrainian).

May 16, 2014