THEORETICAL AND LEGAL ASPECTS OF AVOIDANCE OF DOUBLE TAXATION IN UKRAINE

Abstract

The article is a study of theoretical and legal aspects of avoiding double taxation in Ukraine. We have determined that double taxation is an economic phenomenon when a particular entity is taxed more than once by a homogeneous tax. Double taxation may occur when income received by residents abroad is taxed; with a mixed order of tax payment; when part of the profits of the enterprise to be distributed is taxed. It was found that the laws of different countries of the world have certain features of personal income taxation and differ in the level of development and tax burden, as a result, there is an international double taxation. Legal regulation of the state’s activities in the field of avoidance of double taxation in Ukraine is regulated by the Tax Code of Ukraine and international agreements signed by our state. The imperfection of national tax legislation leads to double taxation within the country. It is investigated that the main provisions of Ukraine on the elimination of double taxation are governed by Art. 13 of the Tax Code of Ukraine, according to which the amounts of taxes and fees paid outside Ukraine are credited during the calculation of taxes on fees in Ukraine according to the rules established by this Code. It is pointed out that double taxation has negative consequences not only for the state but also for taxpayers. As a result, the tax burden increases several times and additional tax liabilities arise for the taxpayer, and as a result, profits are reduced and interest in the economic activity of the latter disappears. Within the framework of national fiscal legislation, the so-called tax credit and tax rebate are often the tools for solving the problem of double taxation. It is determined that the application of a tax credit determines the situation in which taxes paid by foreign states are equated to the taxes of their state. A tax rebate is a tax that is paid as an expense that reduces the amount of taxable income. It has been found that the double taxation convention is currently the most effective tool in the fight against double taxation.