MECHANISMS FOR REDUCING THE HIDDEN ECONOMY THROUGH FINANCIAL TECHNOLOGIES AND DIGITAL TAX CONTROL

Abstract

The shadow economy is one of the primary obstacles that reduces state budget revenues, distorts the competitive environment, and negatively impacts the social protection system. This article analyzes the role of financial technologies (FinTech), cashless payment systems, and the digitalization of tax administration in reducing the scope of the shadow economy. The article highlights that the introduction of electronic invoices, online cash registers, and consumer incentivizing cashback systems yields more effective results than punitive measures.