OFFSHORIZATION OF THE ECONOMY: NATIONAL DIMENSION AND SOCIAL CONSEQUENCES

Abstract

The paper provides an analytical study of the scale and trends of offshoring of the national economy. It is well-founded that Ukraine occupies an insignificant place in the global offshore network and belongs to the group of states that suffer tax losses from offshore activities. It was determined that there is no single approach to justifying tax losses from the offshoring of the national economy. According to various calculations, Ukraine's tax losses from the offshoring of the economy range from UAH 15 to 65 billion annually (according to the Institute of Socio-Economic Transformation) or about 29 million dollars. Annually (according to Tax Justice Network). According to the State Financial Monitoring Service of Ukraine, on average, from 2011 to 2018, funds equivalent to 10.6% of GDP per year were withdrawn from Ukraine. In Ukraine, an inverse relationship between the level of offshoring of the economy and social security was revealed. In addition, the annual tax losses of the budget from the offshoring of the economy lead to a decrease in financing of the social sphere (in 2020, an additional 7.6 billion UAH could be allocated to social protection andprovision, to education – 5.5 billion, to health care – 3.9 billion, spiritual and physical development – 0.7 billion UAH). According to the economicclassification of budget expenditures, it can be stated that offshorization led to underfunding in 2020 of such socially significant items of expenditure as the salary of state employees (9.1 billion hryvnias); payment of pensions and benefits (5 billion hryvnias); other social payments to the population (3billion hryvnias). That is, the offshorization of the economy, reducing tax revenues to the budget, leads to a decrease in the secondary income of thepopulation. On the contrary, the primary incomes obtained from the offshoring of business and excluded from taxation, on the contrary, are growing (as a rule, they are shadow).