Greece among EU states to have slashed VAT gap
Finance Minister Christos Staikouras expressed his satisfaction on Thursday over Greece’s being among four countries that registered the most significant value-added tax gap decreases in 2020, according to an annual European Commission report.
The VAT gap is the estimated difference between the expected revenues of EU member-states and the revenues actually collected.
According to the Commission’s most recent “VAT gap in the EU report,” the most significant VAT gap decreases occurred in four countries: Hungary (4.7 percentage points), Germany (4.2 pp), the Netherlands (4.1 pp) and Greece (3.7 pp).
In a statement, Staikouras said that “Greece achieved one of the greatest reductions in its VAT gap in the EU – despite the appearance of the pandemic and its effect on the economic cycle, which also affects VAT – significantly reducing its loss of revenue, mostly due to to tax evasion. [It’s] a tendency that is expected to continue at greater rates in 2021,” expected to reach 5.7 percentage points, mostly because of greater compliance.
The report also mentions that EU members had lost an estimated 93 billion euros in VAT revenues in 2020, a VAT gap that was very high yet had dropped by approximately €31 billion compared to 2019 figures.
