INTERNATIONAL EXPERIENCE IN REFORMING THE INCOME TAXATION SYSTEM IN POST-PANDEMIC AND WAR PERIODS

Abstract

The international experience in reforming income taxation systems in war and post-war conditions is summarized, in particular, approaches to reforming income taxation systems in the USA, Sweden, Denmark, France and Great Britain are compared. Considered examples demonstrate that despite the low budget efficiency of wealth taxes in many countries of Europe and the world (they did not bring considerable budget revenues and at the same time required significant administrative costs), excess profits taxation has been widely practiced for a long time even after the end of the war, in particular, in the post-pandemic period and during the current energy crisis in the EU countries. Main views are systematized regarding individual wealth taxation – not so much as a threat of capital outflow and disincentive for capital investments but as an important component of the tax system, which, coupled with other income and property taxes, contributes to the restoration of wealth distribution equality and minimizes opportunities for tax evasion. Attention is focused on the application of excess profits tax by the EU countries as a temporary European solidarity contribution in response to the global socio-economic crisis caused by the negative consequences of the COVID-19 pandemic and the increase in energy prices due to the military aggression of the Russian Federation. The key requirements that individual wealth tax must meet to be introduced in Ukraine are substantiated. They include establishing a tax exemption threshold at a high level, as well as extending it not only to the residents of Ukraine, but also to the citizens of other countries who own assets on its territory, in order to increase the tax’s progressivity and budgetary efficiency.