AN ALGORITHMIC APPROACH TO TAX MONITORING IN THE JEWELRY SECTOR OF UKRAINE

Abstract

This research focuses on developing an algorithmic approach to tax monitoring within the jewelry sector of Ukraine, an industry characterized by a high level of tax risk. As traditional methods of tax control have proven ineffective, the development of tools that integrate tax compliance with tax optimization is highly relevant. The study aims to develop an algorithmic model for tax monitoring that considers the impact of an enterprise’s accounting policies on its tax liabilities. The primary objectives are to strengthen tax compliance and mitigate tax risks. The research methodology involves the analysis of accounting and tax data and the modeling of financial results based on different accounting policy assumptions.
The study has developed specific algorithms to verify the integrity of merchandise balances, ensure the compliance of fiscal reports with sales data, and confirm the correct accrual of Value Added Tax (VAT) and proper product identification. A key algorithm models the cost of goods sold using various methods, enabling the selection of the most tax-optimal option within the enterprise’s existing accounting policy. Testing of the algorithms on simulated data has demonstrated their effectiveness in identifying typical tax violations. For maximum efficiency, it is recommended that these algorithmic solutions be integrated into an enterprise’s internal control system. This integration would facilitate the continuous monitoring of tax transactions, the assessment of tax risks, the adjustment of accounting policies, and streamlined interaction with regulatory authorities.
Future research will focus on adapting the developed algorithms to new tax regulations, penalty structures, and evolving accounting policies.