GOVERNMENT FISCAL SECURITY UNDER MARTIAL LAW
Abstract
The article examines the economic category of fiscal security. The article aims to determine the state's fiscal security level, considering the challenges and features of martial law and the justification of priority financial measures to strengthen fiscal stability in the medium term. Indicators of fiscal security are grouped into four main categories - budget revenues, budget expenditures, fiscal deficit, and public debt. We analysed 12 indicators of state fiscal security during the period 2014–2023. In evaluating indicators of fiscal security, we used a graduation from 1 to 10, where 1 is the highest level of fiscal security and 10 is the lowest, respectively. The analysis period covers 2014–2023, from the beginning of the military intervention in Ukraine. In this regard, we will separately consider the time ranges: 2014–2016 – as the initial period of military operations in the eastern regions and the annexation of the Crimean Autonomous Republic; 2017–2021 – the period of stabilization and socio-economic recovery, and 2022–2023 – the stage of a full-scale invasion and actions of martial law. The most critical value in indicators of the state's fiscal security is the shadow economy level and the share of the public external debt in GDP. In general, debt indicators, indicators of the budget deficit and budget expenditures also remain within extremely high values. For the period of full-scale invasion, adjustments were made to the limit values of fiscal security indicators, considering global experience. The author investigated the structure of financing expenditures for Ukraine's defence and security sector in 2022–2023. The largest share in the overall structure belongs to taxes — 63.7%. The share of domestic bonds was 24.5%, and money printing — 11.8%. Measures aimed at reducing the shadow economy level and expanding the tax system's fiscal potential are proposed. It is substantiated that in the post-war period, the government will face the essential task of maintaining macroeconomic stability, which will require systematic measures to reduce the indicators of the ratio of expenditures, fiscal deficit, and public debt to GDP.
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