THEORETICAL APPROACHES TO THE DEFINITION OF THE CONCEPT OF "TAX CREDIT"

Abstract

Today, one of the main guarantees of sustainable and effective development of Ukraine as a modern state governed by the rule of law and ensuring its stability is the coordinated and continuous functioning of the tax system.

The article analyzes the main scientific and theoretical approaches characterizing the legal nature of a tax credit. It is concluded that the concept of tax credit is most often used in two senses: tax credit for income tax and tax credit for value added tax. The main features and differences between the concepts of "tax credit" and "tax benefit" are formulated. It is summarized that it is inappropriate to define a tax credit only as a subtype of a tax benefit.

The concept of "tax credit" has a dual legal nature, since the legal regulation of tax credit is carried out by both mandatory and dispositive methods of legal regulation. We believe that it is inappropriate to define a tax credit as a type of tax benefit, since the concepts of "tax credit" and "tax benefit" are not the same and have rather broad meanings, so it is impossible to fully absorb one concept into the other. A tax credit causes a change in the timing of a tax payment, i.e., it changes only the procedure for fulfilling the tax obligation of taxpayers, and does not exempt them from it, so it is necessary to consider a tax credit not as a type of tax benefit, but as a form of changing the procedure for fulfilling the obligation to pay tax. We also propose to generally define a tax credit as the amount by which a taxpayer is entitled to reduce its tax liability during the relevant reporting (tax period). In view of this, it is advisable to amend Article 14.1.181 of the Tax Code of Ukraine and set forth the definition of "tax credit" as follows: "14.1.181 tax credit – the amount by which a taxpayer of any tax has the right to reduce the tax liability during the relevant reporting (tax period), determined in accordance with Section V of this Code".