KEY DIRECTIONS OF TAX SYSTEM TRANSFORMATION AS A LEVER FOR BUSINESS DEVELOPMENT

Abstract

The article examines the current state and key directions of transformation of the tax system of Ukraine in the context of martial law and ongoing socio-economic changes. The relevance of the study is determined by the need to ensure financial stability of the state while creating favorable conditions for business development and economic recovery. The paper analyzes scientific approaches to defining the structure and components of the tax system and highlights the main factors influencing its functioning under modern conditions. Special attention is paid to the impact of the full-scale war on the national economy, which has led to a reduction in business activity, destruction of production infrastructure, and a decline in tax revenues, while public expenditures, particularly on defense and security, have significantly increased. The study substantiates the importance of transforming the tax system as an effective instrument for stimulating entrepreneurship and ensuring sustainable economic growth. Key directions of transformation include simplification of tax administration, reduction of the tax burden, digitalization of tax procedures, and  improvement of the structure of tax revenues. Particular emphasis is placed on the introduction of modern information technologies in tax administration. The potential use of blockchain technology is considered as a tool for increasing transparency, reliability, and efficiency of tax administration processes, as well as for minimizing corruption risks and tax evasion. The article also analyzes the role of reducing the fiscal pressure on businesses as a factor contributing to the legalization of economic activity, growth of investments, and expansion of the tax base. Attention is given to the planned reform of the simplified taxation system for the period 2025–2027, which aims to improve the conditions for small and medium-sized enterprises and enhance the transparency of financial flows. It is concluded that the transformation of the tax system of Ukraine should be based on a comprehensive approach combining fiscal efficiency, economic feasibility, and support for entrepreneurship. The implementation of these measures will contribute to strengthening financial stability, increasing trust in state institutions, reducing the shadow economy, and creating favorable conditions for post-war economic recovery and sustainable business development.