TAX BENEFITS AS A STATE REGULATION TOOL

Abstract

Taxes, as an economic phenomenon, have evolved over time, transforming from a purely fiscal mechanism into a tool of state management for economic processes. Evolutionary changes occurred, particularly through the clarification of tax functions. One of these functions is regulatory, aimed at altering economic and social processes within the state. The greatest regulatory effect can be achieved through direct taxes, where exemption or reduction of taxes payable directly influences regulated objects to achieve a specific objective. The administration of preferential taxation is transparent, allowing proper control over the use of tax-exempt funds and effective investment attraction. Tax benefits in Ukraine’s tax system not only influence taxpayers’ economic behavior but also prioritize their activities within the state’s economic policy framework. One of the key tools for such regulation is the corporate income tax, being a source of state budget revenue resources that impact the processes of investment, innovation, and foreign economic activity of the entities within the country.