Tax exemptions near €13 bln

Tax exemptions amount to 26.7% of tax revenues, or 7% of gross domestic product, as they reach 12.9 billion euros.

In some cases losses cannot be measured, as for example in inheritances and earnings from games of chance, as they are not computer-supported. This means that the cost is much higher and unmeasurable in several tax sources. However, based on the available data, if tax exemptions did not exist, the state would potentially have significantly increased revenues.

One of the most impressive figures concerns the personal income tax: Its receipts last year amounted to €10.3 billion, while the exemptions from this category exceeded €5 billion.

The twin crises of energy and health inflated tax breaks for households and businesses, as can be seen from the report on tax expenditures submitted to Parliament together with the 2023 budget. In the bailout years many tax breaks were abolished, while others were significantly reduced, with the aim on the one hand of reducing fiscal costs and on the other of introducing a more rational use for groups really needing state support.

According to the data, the number of tax exemptions in 2021 reached 1,047, with their fiscal cost reaching €12.88 billion euros. However, a year earlier tax exemptions had amounted to 967, with their cost amounting to €8.9 billion. That is, within the space of a year they increased by €4 billion. These tax exemptions include refundable advances, special purpose compensation etc.

Corporate income tax has another 200 exemptions and reductions, amounting to €1.3 billion.

Capital taxation accounted for 129 exemptions and reductions in ENFIA, Special Property Tax, transfers, parental benefits, inheritances and donations, amounting to €3.89 billion.

A further category is value-added tax (VAT), with 75 exemptions and discounts totaling €821.9 million.

The other categories of exemptions concern stamp duty, insurance premium tax, consumption tax, vehicle registration fees and road tax.