THEORETICAL ASPECTS OF APPLYING TAX INCENTIVES AS TOOLS TO STIMULATE ENERGY EFFICIENT INVESTMENTS

Abstract

The article explores the concept of "tax incentives" and their utilization in promoting energy-efficient investments. Through a meticulous analysis, the author navigates various definitions of tax incentives, underscoring the imperative for these definitions to be comprehensive, exhaustive, and unequivocal to mitigate potential misunderstandings and inconsistencies in their application. Emphasis is placed on the necessity of accurately distinguishing tax incentives from other mechanisms of tax optimization, alongside advocating for the amalgamation of tax incentives with alternative forms of stimulation to maximize efficacy. Throughout the discourse, the article elucidates the multifaceted nature of tax incentives, citing examples such as elongating the tax period, implementing cash-basis tax accrual, and extending reporting periods for specific taxpayer groups. The author asserts that tax incentives should be perceived as exceptions to prevailing tax norms, tailored to address specific scenarios or demographics. Additionally, the article presents a meticulous classification of tax incentives based on their types and formats, encompassing deductions and discounts aimed at reshaping the tax base or tax object. Moreover, the narrative accentuates the significance of clear tax regulations and transparency within the tax system to preclude ambiguity. By elucidating the nuances of tax incentives and their pivotal role in fostering energy efficiency, the article advocates for refined definitions and strategic integration with other stimuli to optimize effectiveness. At the same time, the author notes that tax incentives can have both a positive and negative impact on budget revenues, emphasizing the importance of tax incentives as an economic tool to stimulate the development of certain industries and activities, as well as the importance of careful planning and regulation of their use in order to avoid negative consequences for the budget. Overall, the article offers comprehensive insights into the intricate landscape of tax incentives, illuminating their significance in incentivizing energy-efficient investments while advocating for precise definitions and synergistic approaches to achieve desired outcomes in tax policy and economic development.