PROBLEMS OF HARMONIZATION OF TAX SYSTEMS OF EUROPEAN UNION COUNTRIES

Abstract

Harmonization of tax systems of the European Union countries is an important condition for the functioning of the single market and ensuring fair competition between member states. The author examines the main problems that hinder harmonization. These include uneven socio-economic development of member states, differences in budget structure and sources of fiscal revenues, political sensitivity of tax policy issues, limited EU mandate in the field of direct taxation, differences in fiscal competitiveness of EU member states. The degree of harmonization of indirect taxation, in particular VAT and excise duties, and the difficulties of harmonizing direct taxation, in particular corporate tax, have been analyzed. Modern EU initiatives to combat tax competition and tax evasion in particular BEPS, ATAD and the introduction of a minimum corporate tax have been considered in the article. The tax burden in EU countries in 2021–2023 has been studied. Special attention has been focused on the need to strengthen tax policy coordination to achieve balanced harmonization that takes into account both integration goals and national interests. Digitalization of tax administration also strengthens the analytical capabilities of state institutions, reduces the level of VAT fraud, promotes the unification of data exchange formats and the development of interaction between national tax systems. As a result, digital tools not only increase the efficiency of fiscal processes, but also contribute to deeper integration of tax policies of EU countries, forming a single digital taxation space. The author notes that the implementation of digital tools and solutions is relevant for Ukraine. The direction of harmonizing the tax system with European standards in the process of implementing the European integration vector of development is especially important for the country. In the future, for the progress of harmonization processes, it was proposed to strengthen institutional coordination between national tax authorities of EU members and the European Commission, take into account large-scale digitalization of tax procedures, and implement coordinated measures to combat aggressive tax planning.