{"id":2691,"date":"2019-09-25T11:46:16","date_gmt":"2019-09-25T11:46:16","guid":{"rendered":"https:\/\/way2vat.com\/?p=2691"},"modified":"2022-11-02T19:30:39","modified_gmt":"2022-11-02T19:30:39","slug":"why-havent-we-closed-the-vat_gst-gap","status":"publish","type":"post","link":"https:\/\/way2vat.com\/why-havent-we-closed-the-vat_gst-gap\/","title":{"rendered":"Why haven\u2019t we closed the VAT\\GST gap?"},"content":{"rendered":"

In the last few years, the EU has been losing as much as \u20ac150 billion every year in unpaid VAT\\GST – most of it due to VAT\\GST fraud like missing trader fraud<\/u><\/span><\/a> and carousel fraud. Countries have been doing their best to clamp down on unpaid VAT\\GST, with little success.<\/p>\n

The VAT\\GST Gap is Narrowing, But Not Fast Enough<\/h3>\n

The most recent annual VAT\\GST gap study, in 2017<\/u><\/span><\/a>, brought news of mixed success for EU-wide VAT\\GST payments. In 2017, the EU as a whole lost \u20ac137 billion in VAT\\GST revenue. This reveals a drop of \u20ac8 billion from 2016, and the 2016 VAT\\GST gap was itself \u20ac7.8 billion less than the year before. The VAT\\GST gap has been shrinking for 5 years in a row, and it\u2019s predicted to drop another \u20ac7 billion to under \u20ac130 billion in 2018.<\/p>\n

However, it\u2019s moving very slowly. Even if it continues to decrease by \u20ac8 billion each year, it will still take another 17 years before \u2018only\u2019 \u20ac10 billion goes missing. EU member states need the revenue lost to VAT\\GST fraud in order to fund infrastructure and services for citizens, so it\u2019s not a victimless crime.<\/p>\n

A Closer Look at the VAT\\GST Gap<\/h3>\n

The 2017 VAT\\GST gap report reveals interesting variations between the VAT\\GST gap of different EU member states. Across Europe, Italy lost the most money to VAT\\GST fraud and miscalculations, with a VAT\\GST gap of around \u20ac33.5 billion, but Romania\u2019s VAT\\GST gap is the largest in percentage terms, at 36%. Other points to note include:<\/p>\n