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Contraction of tax revenue losses from VAT by 3.8 points, which is the fourth best performance among the 27 member states of the European Union, was achieved by Greece between 2021 and 2022, in a first indication that the measures against tax evasion are yielding results.
According to the latest annual report of the European Commission, published today, the so-called “VAT gap” was reduced by 250 million euros, resulting in a decrease to 2.96 billion euros in 2022.
Although our country continues to lag behind the EU average, remaining in 23rd place in 2022, it has drastically improved its compliance rate since 2019. Back then, the lost revenue from the indirect tax was equivalent to 24% of GDP, while in 2022 the percentage is estimated to have dropped by more than 10 points, to 13.7%. This is despite the fact that the pandemic temporarily caused a deep recession in the Greek economy, hence during that period we did not have the significant GDP growth observed today.
Greece’s performance is expected to improve further in the next regular reports, for the years 2023 and 2024, thanks to the rapid growth of the economy after the health crisis and the set of measures against tax evasion that have been put in place, especially in the last two years.
Indicative examples are the connection of cash registers with AADE and POS devices, the myDATA system, based on which VAT returns are pre-filled, and the use of imputed income for determining the tax of freelancers.
The Commission’s report also highlights the transition of many goods and services from the standard VAT rate, which is 24%, to the reduced rate of 13%, especially to protect consumers from price increases after the outbreak of the global inflation crisis in 2022.
As noted by Brussels, between 2018 and 2022, the index of VAT that could be collected in Greece if there were no reduced rates or exemptions increased from 21.5% to 28.4%, while only between 2021 and 2022, the increase reached two points. (18/12/2024)
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