21.01.2022. EU, lost 134 billion euro in VAT revenues in 2019

Company News

On 02.12.21, the Commission published its annual VAT Gap report which measures the overall difference between the expected VAT revenue and the amount actually collected in EU Member States in 2019.
It shows that Member States lost an estimated 134 billion euro in Value-added tax (VAT).
This figure represents revenues lost to VAT fraud and evasion, VAT avoidance and optimisation practices, bankruptcies and financial insolvencies, as well as miscalculations and administrative errors. While some revenue losses are impossible to avoid, decisive action and targeted policy responses could make a real difference, particularly when it comes to non-compliance.
In nominal terms, the overall EU VAT Gap decreased by almost 6.6 billion euro to 134 billion euro in 2019, a marked improvement on the previous year’s decrease of 4.6 billion euro.
In 2019, Romania recorded the highest national VAT compliance gap with 34.9% of VAT revenues going missing in 2019, followed by Greece (25.8%) and Malta (23.5%).
The smallest gaps were observed in Croatia (1.0%), Sweden (1.4%), and Cyprus (2.7%).
In absolute terms, the highest VAT compliance gaps were recorded in Italy (30.1 billion euro) and Germany (23.4 billion euro).