TAXATION OF LABOR INCOME IN THE GIG ECONOMY: A COMPARATIVE LEGAL ANALYSIS OF EUROPEAN AND UKRAINIAN APPROACHES AND THE CHALLENGES OF CROSS-BORDER WORK

Abstract

The rapid expansion of the gig economy transforms labour markets and poses significant challenges to traditional taxation systems. The uncertainty of the legal status of gig workers and the specifics of digital platforms' activities complicate tax administration, lead to fiscal losses, and create unfair competition. This article aims to comprehensively analyse approaches to taxing the income of gig workers and platform activities, compare European (including the DAC7 Directive) and Ukrainian experiences (including the Diia.City regime), study the economic consequences of different taxation models, and address cross-border work issues. The methodology includes comparative legal, systemic, formal legal, and economic methods. The influence of the legal classification of relationships (labour, civil, entrepreneurial, gig contract) on taxation regimes (PIT, Military Levy, SSC, single tax) is examined. European initiatives to enhance tax transparency and national practices in taxing gig work are analysed. The fiscal potential and economic effects of different models are assessed. Key cross-border taxation problems are identified: residency, application of double taxation treaties, VAT on digital services, and determination of platforms' permanent establishment. Recommendations for improving Ukrainian tax legislation are proposed to enhance tax collection efficiency and adapt to the realities of the gig economy.