The European Commission has published the results of the “Study and Reports on the VAT Gap in the EU-28 Member States”, a report analysing the so-called "VAT gap" – the overall difference between the expected VAT revenue and the amount actually collected – across the 28 Member States for the year 2018.

Although the margin has improved slightly in recent years, it remains extremely high, standing at approximately 140 billion euros. Furthermore, it should be noted that a reversal of this trend is expected for 2020: the Commission estimates a potential loss of 164 billion euros due to the impact of the coronavirus pandemic on the economy.

In terms of individual country performance, Romania recorded the highest national VAT gap in percentage terms, with 33.8% of VAT revenue missing in 2018, followed by Greece (30.1%) and Lithuania (25.9%). In absolute terms, however, the worst result was recorded by Italy, with an estimated VAT gap of 35.4 billion euros, followed by the United Kingdom (23.5 billion euros) and Germany (22 billion euros).

The full text of the report can be downloaded at the bottom of this news item.

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