- More than 170 countries worldwide, including major European countries, have a value-added tax (VAT) on goods and services.
- EU Member States’ VAT rates vary across countries but are somewhat harmonized by the EU.
- Hungary has the highest standard VAT rate at 27%, while Luxembourg has the lowest at 16%.
- The EU average standard VAT rate is 21.6%, higher than the minimum required by EU regulation.
- Switzerland is the only non-EU European country with a standard VAT rate below the EU minimum at 8.1%.
- Consumption taxes are economically efficient, but EU countries have reduced rates and exemptions for certain goods and services.
- Reduced VAT rates and exemptions may not effectively achieve policy goals and can create economic distortions.
- Some European countries have made changes to their VAT rates, including Estonia, Switzerland, and Turkey.
Source: taxfoundation.org
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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