Consolidation of the unified social contribution and personal income tax in the context of Ukraine’s European integration aspirations

A. Sokolovska
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Abstract

Introduction. The high tax burden on labor is a problem not only for Ukraine, but also for many European countries, negatively affecting the labor market, in particular, it is considered one of the reasons for relatively high unemployment and informal employment. In Ukraine, it is proposed to solve this problem by consolidation the unified social contribution(hereinafter-USC) and personal income tax( hereinafter-PIT)(in fact, by abolishing the unified social contribution). Problem Statement. Despite the fact that the implementation of this proposal is associated with serious fiscal and social risks, it has not been the subject of scientific debate, although it was first published in Ukrainian periodicals in 2018-2020. Purpose. To assess the abolition of the unified social contribution in the context of compliance of such a transformation with European guarantees of adequate social protection and the European social model in general. Methods. The methods used are comparative and statistical analysis, abstract logic, analogies and theoretical generalization. Results. It has been established that, unlike the proposal to consolidate USC and PIT in Ukraine, the implementation of which will lead to a decrease in the living standards of people who have already retired and will receive a minimum income from the state budget, which will be able to protect them only from absolute poverty, and reliance on future pensioners-participants of private pension funds of all risks related to their provision after termination of employment, principle 15 of the European Pillar of Social Rights emphasizes the right of older persons to adequate pensions and a dignified old age. The importance of achieving this goal is evidenced by the fact that every three years, the European Commission publishes a report that reviews the current and future adequacy of old-age incomes in EU member states in three dimensions – poverty prevention, ability to replace income received before retirement and retirement duration – and analyzes key reforms aimed at ensuring the financial sustainability of pension systems. Such reforms are carried out in two main areas: revision of social contribution rates and expansion of financing from general government revenues, in particular, property, consumption, and environmental taxes. Conclusions. It has been found out that the abolition of USC as a stable source of financing the social insurance system in Ukraine will result in either its erosion or complete dismantling of the welfare state. This may complicate our movement towards the EU due to the inconsistency of Ukrainian approaches to solving social problems with European ones.
在乌克兰实现欧洲一体化愿望的背景下,巩固统一的社会缴款和个人所得税
介绍。劳动力的高税负不仅是乌克兰的问题,也是许多欧洲国家的问题,对劳动力市场产生了负面影响,特别是被认为是失业率和非正规就业相对较高的原因之一。乌克兰提出通过合并统一社会缴费(以下简称usc)和个人所得税(以下简称pit)(实际上是废除统一社会缴费)来解决这一问题。问题陈述。尽管该提案的实施与严重的财政和社会风险有关,但它并没有成为科学辩论的主题,尽管它于2018-2020年首次发表在乌克兰期刊上。目的。在这种转变是否符合欧洲对充分社会保护的保证和一般的欧洲社会模式的背景下,评估取消统一社会缴款的情况。方法。使用的方法是比较和统计分析,抽象逻辑,类比和理论概括。结果。已经确定的是,与乌克兰合并USC和PIT的提议不同,该提议的实施将导致已经退休的人的生活水平下降,他们将从国家预算中获得最低收入,这将能够保护他们免受绝对贫困,并依赖未来的养老金-私人养老基金的参与者在雇佣终止后提供的所有风险。《欧洲社会权利支柱》原则15强调老年人有权获得足够的养恤金和有尊严的晚年。实现这一目标的重要性可以从以下事实得到证明:每三年,欧盟委员会发布一份报告,从三个方面审查欧盟成员国当前和未来老年收入的充足性——预防贫困、替代退休前收入的能力和退休时间——并分析旨在确保养老金体系财务可持续性的关键改革。这些改革主要在两个领域进行:修订社会缴款率和扩大一般政府收入的融资,特别是财产税、消费税和环境税。结论。人们已经发现,取消USC作为乌克兰社会保险制度的稳定资金来源,将导致其受到侵蚀或完全瓦解福利国家。这可能会使我们走向欧盟的运动复杂化,因为乌克兰解决社会问题的方法与欧洲不一致。
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