The European Commission has published its final report of its study to quantify and analyse the VAT gap in the EU-27 Member States. The report provides estimates of the VAT gaps for 26 of the 28 current countries of the EU for the period 2000 to 2011 (Cyprus was not be included due to the imminent release of major revisions to its national accounts, and Croatia was excluded because it joined the EU after the report was completed).
The total VAT gap for the 26 EU countries is said to amount to approximately €193bn in 2011, or about 1.5% of the GDP of the EU 26, an increase from the 1.1% of EU 26 GDP recorded in 2006. Italy, France, Germany and the UK contributed over half of the total VAT gap in absolute terms, although in terms of their own GDP the countries with the largest gaps are Romania, Latvia, Greece and Lithuania. The ‘VAT gap’ is defined as the difference between the theoretical tax liability according to the tax law and the actual revenue collected.
The European Commission has published its final report of its study to quantify and analyse the VAT gap in the EU-27 Member States. The report provides estimates of the VAT gaps for 26 of the 28 current countries of the EU for the period 2000 to 2011 (Cyprus was not be included due to the imminent release of major revisions to its national accounts, and Croatia was excluded because it joined the EU after the report was completed).
The total VAT gap for the 26 EU countries is said to amount to approximately €193bn in 2011, or about 1.5% of the GDP of the EU 26, an increase from the 1.1% of EU 26 GDP recorded in 2006. Italy, France, Germany and the UK contributed over half of the total VAT gap in absolute terms, although in terms of their own GDP the countries with the largest gaps are Romania, Latvia, Greece and Lithuania. The ‘VAT gap’ is defined as the difference between the theoretical tax liability according to the tax law and the actual revenue collected.
