THE CURRENT STATE OF ENVIRONMENTAL TAXATION IN UKRAINE
Natalia MOCANU, Moldova State University Olena NOVYTSKA, Marharyta DAVYDENKO, The State Tax University, Irpin city, Kyiv region, Ukraine
Abstract
The foundational principles of environmental taxation, serving as a cornerstone for driving sustainable development, have been further elaborated upon. It has been ascertained that the current environmental tax framework in
Ukraine is not effectively fulfilling its intended roles of incentivizing environmentally responsible practices and
providing compensation for environmental impacts. Additionally, the business community frequently perceives tax
hikes as nothing more than an additional fiscal burden. In light of these findings, a set of recommendations has been
formulated to enhance the efficacy of environmental taxation in its capacity as a catalyst for sustainable development,
drawing inspiration from best practices observed internationally.
These proposed enhancements encompass a range of strategies. They include refining the conceptual framework
of the environmental tax, particularly with regards to CO2 emissions, and modernizing other categories of environmental taxation. Another vital suggestion involves adjusting the allocation proportions of tax revenues from environmental taxation among various levels of government budgets. This adjustment seeks to foster a more consistent
and coordinated approach to environmental tax policy. Moreover, there is an emphasis on optimizing the utilization
of tax revenues generated from environmental taxation, alongside the reinforcement of comprehensive compliance
monitoring and the introduction of a stimulus system geared towards facilitating a gradual shift towards a carbon-free
economy.
Implementation of these recommendations holds the potential to elevate environmental consciousness and overall
tax effectiveness in Ukraine. This, in turn, can attract businesses to invest in environmentally friendly technologies
and production processes. In the long term, these initiatives aim to stimulate the ecological transformation of businesses and instill a culture of responsible energy resource utilization. Such efforts are poised to contribute to the
gradual transition of the economy towards sustainability, fostering innovation in the post-war era while taking into
account the interests of all stakeholders involved.
Keywords: environmental taxation, emissions, tax revenues, carbon-free economy.
