European Union countries will make a potential loss of EUR 164 billion (USD 194 billion) in Value-Added Tax (VAT) revenues in 2020 due to the effects of the coronavirus pandemic on the economy. According to a new report released by the European Commission Thursday, this figure is a big increase from the loss that EU countries suffered of EUR 140 billion (USD 165 billion) in VAT revenues in 2018. The loss highlights once again the need for a comprehensive reform of EU VAT rules to put an end to VAT fraud, and for increased cooperation between Member States to promote VAT collection while protecting legitimate businesses, said the report.
Paolo Gentiloni, EU Commissioner for Economy, commented that “the coronavirus pandemic has drastically altered the EU’s economic outlook and is set to deal a serious blow to VAT revenues too.” “At this time more than ever, EU countries simply cannot afford such losses. That’s why we need to do more to step up the fight against VAT fraud with renewed determination,” he added.