FISCAL IMPACT OF PROPERTY VALUATION IN THE PRIVATIZATION PROCESS: THE CASE OF UKRAINE

In countries with economies in transition, the fiscal impact of property valuation in the privatization process may be low due to the lack of governance practices, corruption risks, and the pursuit of political goals. Property valuation specifically determines the level of budget revenues and long-term fiscal effects: underestimation of property valuation due to political interests can entail the lack of growth in profitability and efficiency of privatized facilities; overestimation of the objects' value can lead to a low level of competition. The purpose of the article was to study the fiscal effects of property valuation in the privatization process drawing on the experience of Ukraine as a country with economy in transition. Based on the methodology combining qualitative and quantitative data as well as statistical analysis, the fiscal effects of property valuation during privatization in Ukraine were addressed. Management balance sheet and market mechanisms of property valuation at sale were revealed. The study proved the importance of a restrained privatization policy under the conditions of a crisis in a transition economy to ensure short-term and long-term fiscal impact. The automation of property valuation processes and creation of electronic sales systems ensure the effectiveness of market approaches to valuation and price increases for sales items. In the conditions of transition to market conditions, the restrained policy and automation of price formation mechanisms basically are a way to reduce the risk of underestimation of the value of state-owned objects.