Malta is one of 11 EU member states that made a marked improvement in VAT collection in 2013, although it still came under by €210 million.

The island remains among the top 10 member states having a high rate of VAT evasion.

Based on VAT collection figures from 2013, a European Commission study shows that the difference between expected revenue and the amount actually collected, the so-called VAT gap, narrowed by 4.6 per cent over the previous year. While Malta’s calculated VAT gap in 2012 stood at 31 per cent, it dropped to 26.4 per cent a year later. However, this figure remains much higher than the 15.2 per cent average in the EU.

While Malta’s calculated revenue from VAT in 2013 should have totalled €796 million, only €586 million were recouped.

In 2012, €536 million from VAT went into Malta’s tax coffers even though the amount should have been €777 million, a shortfall of €241 million.

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