A staggering €159.5 billion in Value Added Tax (VAT) revenues were lost across the EU in 2014 according to figures released by the European Commission today. The findings support recent calls by the Commission to overhaul the EU’s VAT system to tackle fraud and make it more efficient. Member States must now follow up on the Commission’s Action Plan towards a single VAT area presented last April by agreeing on the way forward towards a definitive VAT regime for cross-border trade in the Union. More immediate measures to tackle the problem of VAT fraud have already been set in motion, but today’s figures show that deeper reforms are needed.
Pierre Moscovici, Commissioner for Economic and Financial Affairs, Taxation and Customs said: “Our Member States are losing tens of billions of euros in uncollected VAT revenue. This is unacceptable. The current regime is woefully ill-equipped to deal with the problems of VAT fraud and miscalculations, and it’s clear that the numbers will not get better by themselves. Member States must now quickly agree on a definitive fraud-proof EU VAT system, as laid out by the Commission earlier this year. I therefore urge all of our Member States to have a frank and meaningful discussion in order to feed into next year’s proposals, so we can tackle this issue once and for all.”
