Journal of Security and Sustainability Issues

The article deals with the VAT gap, its split by causes and determinants, the problem of dependencies. The article also reveals the main ways of calculating the VAT gap - their advantages and disadvantages, summarizes the research done by theoreticians and evaluates the research results. After the theoretical analysis and presentation of the research methodology, the aim is to find out the variables that influence the VAT gap in Lithuania. Using the regression analysis model, the factors determining the VAT gap and their significance, as well as their impact on the decrease / increase of the VAT gap in Lithuania, were identified.

The theoretical and methodological principles of researching the tax security of a state were substantiated with the emphasis placed on the two basic economic theories: the social choice theory and the reflectivity theory. The differential features of national tax systems under globalization conditions and their impact on the economic security of the countries that differ in the political regime, the level of economic development, geography and location were identified. There was given the assessment of the cross-sector approach, based on which multifactor effective marginal tax rates in the European Union (EU) are calculated, and of the marginal approach to taxation in general. The analytical study of tax security of the countries of Organization of economic cooperation and development (OECD) was carried out based on the assessment of the specific weight of taxes in gross domestic product, as well as the structure of taxes in the context of taxation objects: income individuals, income corporates, social security contributions, property, value added taxes, other consumption taxes. A particular attention is attached to the problems of taxation of the motion of capital and goods between the EU countries within the framework of ensuring the mutual economic benefits of the collective interests. The assessment of external and internal threats to tax security of Ukraine was performed based on the identification of the shadow economy segment, reasons for its emergence and consequences for the national economy, as well as the dynamics of the absolute and relative indicators of the budget-debt security. The recommendations on strengthening the tax security of Ukraine under the European integration conditions were given.

The transfer pricing penalties applied in EU countries are analysed in the article. The authors recommend the transfer pricing determination and imposition methodology which could be applied in EU countries as well as in countries where the transfer pricing requirements are based on the OECD transfer pricing guidelines. The authors recommend setting the penalty taking into account: 1) the difference of income tax rates in countries where the transaction parties are acting; 2) value of the transaction; 3) the difference between the arm’s length price and the transfer price; 4) the risk multiplication factor.