The paper systematizes theoretical provisions of the impact of compliance costs on the innovative development indicators and provides the assessment of this impact. The authors study the concept of compliance costs in the world literature; we define their role in ensuring the quality of state regulation. Using regressive and correlation analysis methods, the authors assess correlation between compliance costs in the field of tax payment and a number of indicators of innovative economic development. The authors also conduct correlation analysis of the interrelation between other components of the regulatory costs (in particular, the total tax burden) and innovation indicators in order to identify the contribution of elements to the overall effect. Analysis shows that there is no significant impact of compliance costs on studied indicators while revealing the appreciable impact of change in tax burden. We draw conclusion about the great importance of the financial component in the composition of regulatory costs in comparison with compliance costs.
Highlights:
1. There are two main effects of the introduction of the regulatory standard: the negative one – emergence of regulatory load; and the positive one that stimulates innovations.
2. Compliance costs are costs that are incurred by all the subjects at whom regulation may be targeted to comply with the regulatory requirements.
3. The research question is whether there is a correlation between taxation compliance costs and several key innovative development indicators.
4. The conclusion of the study is that there is no significant impact of compliance costs on studied indicators.
5. We reveal a negative impact of total tax burden on the innovative development.
6. Compliance costs do not provide negative impact of regulatory costs, tax burden does, the state should assess it.
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