DYNAMICS OF REGISTRATION AND LIQUIDATION OF NATURAL PERSONS - ENTREPRENEURS AS AN INDICATOR OF ADAPTABILITY OF SMALL BUSINESS TO MACROECONOMIC INDICATORS OF THE DEVELOPMENT OF THE COUNTRY'S ECONOMY

Abstract

The article analyzes the dynamics of registration and termination of individual entrepreneurs (sole proprietorships/FOPs) in Ukraine from 2021 to 2025 and assesses the adaptive potential of entrepreneurship under martial law. It is substantiated that the dynamics of opening and closing sole proprietorships serve as a direct indicator of the economic and regulatory situation. The study examines the impact of the war, migration, declining purchasing power, tax burden, and legislative changes on entrepreneurs' decisions to continue or cease operations. It was established that the largest wave of sole proprietorship closures occurred in early 2025 following the reinstatement of mandatory single social contribution (SSC) payments and the introduction of the military tax. These closures predominantly affected inactive sole proprietorships under the first and second groups of the simplified tax system. The regional and sectoral structure of business terminations was investigated. It was found that the highest number of sole proprietorship closures occurred in Kyiv, as well as in the Dnipropetrovsk, Kharkiv, Odesa, and Lviv regions. The most vulnerable sectors were retail and wholesale trade, IT, personal services, and information services. At the same time, in January – June 2026, over 141.4 thousand sole proprietorships were registered, compared to 102.2 thousand closures, with terminations decreasing by 36% compared to the same period of the previous year. Entrepreneurial growth was observed in education, retail trade, postal and courier services, particularly in Kyiv, Dnipropetrovsk, and Lviv regions. The lifespan of sole proprietorships was analyzed. The findings indicate that businesses in warehousing, real estate, and equipment repair operate the longest, whereas the shortest operational lifespans are characteristic of postal services, wholesale trade, education, and service sectors. The necessity of improving state support policies for small businesses through a predictable tax environment, access to financing, grant and loan programs, and the digitalization of administrative services is substantiated. It is proven that combining digital tools, state support, and regulatory stability will enhance small business resilience during wartime.