Taxation Trends Report

2018 Edition

EU-28 tax revenues edge upwards …

Tax revenues (including social contributions) as % of GDP

20

25

30

35

40

45

50

0

1000

2000

3000

4000

5000

6000

7000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Tax revenue (including social contributions) in billion euros, and as % of GDP

Revenue in billion euros (left axis) Revenue as % of GDP (right axis)

Tax to GDP increases in 19 Member States

-3

-2

-1

0

1

2

3

Change in tax revenue to GDP, 2015-16 (percentage points)

Composition of taxes

Consumption taxes

Labour taxes

Capital taxes

Indirect taxes

Direct taxes

Social contributions

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

by tax base by type of tax

Structure of EU-28 tax revenue, 2016 (% of total tax revenue)

Modest increase in revenue from labour taxes, smaller rises in consumption and capital taxes

-0.10

-0.05

0.00

0.05

0.10

0.15

0.20

0.25

CONSUMPTIONTAXES

TOTAL LABOURTAXES

Labour taxespaid by employers

Labour taxespaid by non-

employed

Labour taxespaid by employees

TOTAL CAPITALTAXES

Taxes oncorporate income

Taxes on capitalstocks

Taxes onhouseholds' capital

income

Taxes on self-employed income

EU-28 changes in tax revenues as % of GDP, 2015-2016(percentage points)

Share of labour taxes fell slightly since the crisis, while capital and consumption shares rose

28.7 28.5 28.1 28.0 27.6 27.7 28.7 28.8 28.5 28.4 28.5 28.6 28.5

50.1 49.4 48.8 48.4 49.8 51.9 51.2 50.8 50.6 50.5 50.3 49.7 49.8

21.2 22.1 23.1 23.6 22.6 20.4 20.0 20.3 20.8 21.0 21.2 21.7 21.7

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

EU-28 source of revenue (% of total taxation)

Consumption Labour Capital

Property tax revenues have risen since 2009

0.0

0.5

1.0

1.5

2.0

2.5

3.0

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

EU-28 property tax revenues (as % of GDP)

Recurrent taxes on immovable property Other taxes on property

Average VAT standard rate remains stable

15%

16%

17%

18%

19%

20%

21%

22%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

EU average standard VAT rateEU-28 average rate

… but most Member States have increased VAT rates since 2000

0

5

10

15

20

25

30

Standard VAT rates (%)

2018 2000

No changes in VAT rates in 2018, few changes since 2015

1

4

1 1

2

0

1

0

5

9

5 5

6

3

1

0

1

0

1

0

1

2

0

1

0

1 1 1

0 0

1

0 0

1 1

0

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year-to-year changes in standard VAT rates

Number of MS with rate rise Number of MS with rate fall

Average top PIT rate unchanged in 2018

0

10

20

30

40

50

60

70

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Top Statutory Personal Income Tax Rate (%) EU-28 average and range

Top corporate income tax rates level off in 2018 …

0

10

20

30

40

50

60

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Top Statutory Corporate Income Tax Rate (%) EU-28 average and range

… but since 2000 almost all Member States have significantly lowered top corporate rates …

0.0

10.0

20.0

30.0

40.0

50.0

60.0

Top statutory corporate income tax rates

2018 2000

… although the frequency of CIT rate changes is less than it was pre-crisis

0 0

1

0

1 1 1 1 1 1

2

1

5

0

1

0

1

2

10 10

6

9

11

6

9

8

4

5

3

4

3

4

5

3

6

2

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Year-to-year changes in top CIT rates

Number of MS with rate rise Number of MS with rate fall

Main messages

• Revenues

• - EU tax revenues rose in 19 Member States in 2016

• - The share of labour taxes fell slightly from 2009 to 2016, while capital and consumption shares rose

• - Property tax revenues have grown since 2009

• Rates

• - VAT rates remained unchanged in 2018, continuing a trend of few rate changes since 2015

• - Average top personal income tax rate was unchanged in 2018

• - Average top corporate rate levelled off in 2018, but has dropped much more slowly in the period since 2009