Fiscal Policies in the Era of Digital Technology Development: European Experience

Abstract

Introduction: The increasing demand for efficient finance management and tax system improvement urges a detailed study of foreign practices and their effect on the Ukrainian economy. For instance, developing countries can learn from developed nations' experiences in developing effective strategies for financial stabilisation. It can also aid in the advancement of the Ukrainian economy. The study of fiscal practices and their outcomes in the EU and Ukraine can help to learn the experience and choose the optimum ways of reforming the country's fiscal policy. We are speaking of the changes in Ukraine's tax systems, budgetary policies, and public finances management.

Objectives: The policies applied in every EU member state, including Ukraine, are the primary focus of this paper, in addition to the taxation and the revenue collected therein. Mechanisms of how growth can be achieved in Europe are also considered, especially during periods of fighting.

Methods: The study relied on a literature review, a comparative assessment of the fiscal practices of the EU and Ukraine, an analysis of policies on public finances in times of war, a classification of the related constructs on reconstruction in war, and a regression analysis on public finance and management.

Results: At the same time, the main problem with implementing this plan is focused on the problem of taxation as it is becoming more complex. On the contrary, the preparation in Ukraine is making progress in simplifying the taxes and introducing gradual tax reductions. Especially during armed conflict, using a market-oriented approach in implementing expansionary or contractionary fiscal policy is problematic. Therefore, a necessary precondition for ensuring stability and restoring health is rejecting other financial and economic management methods. The need to build up fiscal reserves emerged within the framework to enhance fiscal policy under martial law conditions.

Conclusions: Even under martial law, sound fiscal policy is crucial for maintaining liquidity and enabling economic development to sustain change. The practised strategies are geared towards the fundamental objectives of achieving equity, providing a decent standard of living, and fairness while ensuring that the cost is acceptable. In this context, fiscal measures, in conjunction with social policies, can bring about equity and economic development in the future.