Taxation of Workers in the Gig Economy: World Practice and Challenges for Ukraine

The gig economy is a relatively new phenomenon and is characterized by the fact that the availability and rapid spread of temporary, flexible jobs is becoming commonplace, and employers prefer hiring independent contractors and freelancers instead of full-time employees. The spread of the gig economy significantly affects the development of labor relations and relates primarily to the payment of taxes by individuals working as freelancers. Therefore, such individuals must accrue and pay taxes on their income on their own. The purpose of the article is to study the degree of influence of changes (in particular, changes related to the spread of employment through digital platforms) occurring in the labor market on the taxation and tax revenues of governments as well as provide proposals on motivating freelancers to work in the official sector, voluntary registration by payers and payment tax liabilities in full. The main trends in the labor market based on the hypothesis of the rapid growth of the gig economy in the future were considered. Based on the simulation, an assessment of the potential impact of the identified trends on tax revenues of local budgets in Ukraine was made. It was shown that the share of self-employed people in Ukraine is 15 % of the total number of employed people aged 15-70 years, which corresponds to the European trend. A comparative analysis of the tax regimes used in the world and in Ukraine regarding self-employed persons and freelancers in terms of encouraging them to pay taxes voluntarily was carried out. Suggestions were given regarding the regulation of the labor market in Ukraine and the specifics of taxation of self-employed persons in the context of the spread of the gig economy. It was substantiated that the creation of the so-called "umbrella companies", which will take on the role of employers for freelancers and freely hired workers, and will process of most documents, including those related to the payment of taxes, can have a positive effect on the completeness of taxes paid by participants of the gig economy.