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VAT - Gap Convergence in Central and Eastern Europe

Author

Listed:
  • Lóránd Králik

    (Partium Christian University)

  • Erzsébet Szász

    (Partium Christian University)

Abstract

Tax system structure and the effectiveness of tax collection influences tax-gap. In the present research the authors analyse the improvement of tax collection practices in 26 European Union member states. The paper also explores the convergence characterizing the process of VAT-gap reduction in the Central and Eastern European region. The VAT-gap is investigated with the beta (β) convergence model developed by Barro and Sala-i-Martin (1992), initially used for the measurement of real income convergence. Beta-convergence means that countries with lower level of income grow faster than rich ones in the same period. No significant VAT-gap convergence could be identified between the 26 European countries, but a relatively strong convergence could be observed in the case of the CEE region.

Suggested Citation

  • Lóránd Králik & Erzsébet Szász, 2019. "VAT - Gap Convergence in Central and Eastern Europe," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 772-778, December.
    • Handle: RePEc:ovi:oviste:v:xix:y:2019:i:2:p:772-778
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    References listed on IDEAS

    as
    1. Rita de la Feria, 2013. "EU VAT rate structure: towards unilateral convergence?," Working Papers 1305, Oxford University Centre for Business Taxation.
    2. Axel Möhlmann, 2014. "Persistence or Convergence? The East-West Tax-Morale Gap in Germany," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 70(1), pages 3-30, March.
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    More about this item

    Keywords

    tax gap; tax collection; effectiveness; value added tax; convergence;
    All these keywords.

    JEL classification:

    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • C18 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Methodolical Issues: General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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