Nataliia Rudyk

The article substantiates the necessity of development and implementation of ethical rules of doing business into the business practices of small and medium enterprises. Particular attention is paid to business entities in Ukraine as a country with one of the highest levels of shadow economy. The two-level structure of SMEs’ Code of Ethics designed by the author is being presented, which is based on the following key concepts: transparency of business entities activity, partnership integrity, environmental and social responsibility, which are interrelated and reflected in the individual modules of the Code.
The article presents the results of approbation of the author’s Code of Ethics for SMEs. The approbation is based on a personal and interactive questionnaire about the readiness of Ukrainian SMEs representatives to introduce ethical norms into their activities. The authors determined that Ukrainian SMEs are not well-informed about possible positive effects from following norms and rules in business, in particular, in terms of improving the business climate in the country, increasing the investment attractiveness of the economy as a whole and economic entities in particular, simplifying the access to financial and credit instruments.
The survey and questionnaire of Ukrainian SMEs confirmed the need for the development and implementation of the business Code of Ethics norms, as well as potential demand for it. The respondents recognize the importance of certain international ethical rules in conducting business, which may contribute to attracting investment in Ukraine; however, this is not the only factor affecting the investment attractiveness of domestic business. It is substantiated that the business climate improvement is a complex issue, and the Code of Ethics, in this context, creates the opportunities of guiding and encouraging participants to the active influence on the business environment: to declare zero tolerance to corruption and to form and to maintain clear position in interactions with the public authorities.

One of the main problems of the fiscal decentralization in Ukraine is the substantiation of the optimal proportion of the personal income tax distribution among the state and different types of local budgets in order to insure the sufficient financial resources for the territorial communities. Since period of the Budget Code adoption, the percentage of the personal income tax paid from salaries to the different levels of budgets has changed three times. However, the methodic of such distribution is not clear. The authors suggest approach of analyzing the logic of the personal income tax distribution on the game theory basis. They consider different ways of making decisions and prove that in all of the analyzed cases the winner was the central government of Ukraine. Such behavior of the central government in making decisions does not meet the goals of the fiscal decentralization reform. The main reason of such situation is that the decisions are made by the state government, but not by the local communities or their representatives. Besides, it is difficult to distribute the expenditures among different types of budgets according to the Governments’ competences. The authors suggest some recommendation of the personal income tax distribution in order to ensure benefits for all participants of the game: communities, local governments and central government. But they conclude that the active influence of people on the behavior of the local governments is the basic premise for the scientific research of the PIT optimal distribution.