Financial Monitoring as a Tool for Implementing State Budgetary and Tax Policy

The article examines financial monitoring as a component of the institutional mechanism for implementing state budgetary and tax policy, emphasizing its indirect potential to strengthen fiscal capacity by increasing the transparency of the payment environment and narrowing the scope for shadow turnover. The purpose of the study is to substantiate financial monitoring as an instrument of budgetary and tax policy by identifying the channels through which it may influence tax discipline and budget revenues, and by developing approaches for assessing the quality of the relevant regulation. The manuscript is a theoretical-analytical study with descriptive statistical illustration based on aggregated official data and does not provide a causal estimation of the fiscal effect. The methodological basis combines institutional and risk-based approaches; the study employs theoretical generalization, structural-functional analysis, content analysis of the regulatory framework, and descriptive interpretation of official statistics of the State Financial Monitoring Service of Ukraine. The two-tier institutional structure of financial monitoring is systematized, and the regulatory logic of two complementary response regimes—threshold and suspicious transactions—is characterized. The analysis demonstrates the mass scale of reporting and the dominance of the banking segment in the reporting flow, indicating a high intensity of regulatory coverage of the payment environment (given the available aggregated data). A conceptual indicator system is proposed to assess regulatory quality within the “effectiveness–efficiency–proportionality” logic and to distinguish between regulatory activity and regulatory effectiveness. The theoretical contribution is a coherent analytical framework integrating AML/CFT monitoring and fiscal governance through a channel-based interpretation of “risk signals” in budgetary and tax policy, providing a basis for subsequent empirical testing. The practical relevance lies in applying the proposed indicators to monitor regulatory quality and target supervisory resources while minimizing compliance burden. Further research should expand the empirical base and validate the indicators dynamically, including by transaction types and groups of primary financial monitoring entities.