The search for incentives for the transformation of innovative development in the context of limited activity is an urgent issue in the conditions of martial law and post-war recovery. Through the government support, grants, tax incentives, and the formation of innovation funds, the State takes an active part in the process of transformation of the economy. Innovation is seen as a direct indicator of the impact on the profitability of an enterprise. Foreign markets remain a priority in export-import activities, especially in the context of a limited activity of the latter. Achieving the indicators of profitability and competitiveness affects the state of export-import activities. The aim of the article is to present the theoretical principles and provide practical recommendations for finding incentives for the transformation of innovative development in conditions of limited activity – taking into account the experience of the EU, research of scholars, legislative norms in the field of economics; substantiation of the feasibility of their implementation during martial law and in post-war conditions with limited activities. In the analysis, systematization, generalization of scientific works of both domestic and foreign scholars, the relevance of views on innovative processes, their significance in the development of the State economy during martial law and prospects for development in the post-war period is considered. The views on «tax incentives of the investment and innovation process», which are constantly being improved in accordance with the requirements of the time, are systematized. It is defined that in Ukraine the State, in comparison with the EU countries, is not an active participant in the innovation and investment process, the indicators of its participation in expenditures on innovation and public investment in relation to GDP are much lower than in the EU. The current approaches of the EU to funding expenditures on innovations, the development of various platforms, the search for mechanisms for intensifying innovation activity, in particular through startups, are considered. The Google-supported assessment of the level of interest in startups showed that the English-speaking audience searches for this topic most often. As for Ukrainian-speaking users, the search trends for startups and innovations coincide. Prospects for further transformation of innovation and investment development are the introduction of mechanisms and forms of the digital economy.
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