Insider Business Tax to GDP ratio in Cyprus stood at 34% in 2017, according...

Tax to GDP ratio in Cyprus stood at 34% in 2017, according to Eurostat

The overall tax-to-GDP ratio, meaning the sum of taxes and net social contributions as a percentage of Gross Domestic Product, stood at 40.2% in the European Union (EU) in 2017, while in 2016 it stood at 39.9%. In the euro area, tax revenue accounted for 41.4% of GDP in 2017, slightly up from 41.2% in 2016.

Total revenue from taxes and social contributions as percentage of GDP in Cyprus increased from 28.0% in 2002, to 36.1% in 2007, to 31.6% in 2012 and finally to 33.3% , 32.9% and 34.0% for 2015, 2016 and 2017 respectively.

In 2017 this 34.0% is structured as follows: 15.9% from taxes on production and imports, 9.5% from VAT, 9.4% from taxes on income, wealth, etc.  (out of which 3.1% form taxes on individual or household income, 5.7% from taxes on the income or profits of corporations) and 8.7% from net social contributions.

The tax-to-GDP ratio varies significantly between Member States, with the highest share of taxes and social contributions in percentage of GDP in 2017 being recorded in France (48.4%), Belgium (47.3%) and Denmark (46.5%), followed by Sweden (44.9%), Finland (43.4%), Austria and Italy (both 42.4%) as well as Greece (41.8%). At the opposite end of the scale, Ireland (23.5%) and Romania (25.8%), ahead of Bulgaria (29.5%), Lithuania (29.8%) and Latvia (31.4%) registered the lowest ratios.

Compared with 2016, the tax-to-GDP ratio increased in fifteen member states in 2017, with the largest rise being observed in Cyprus (from 32.9% in 2016 to 34.0% in 2017), ahead of Luxembourg (from 39.4% to 40.3%) and Slovakia (from 32.4% to 33.2%). In contrast, decreases were recorded in thirteen Member States, notably in Hungary (from 39.3% in 2016 to 38.4% in 2017), Romania (from 26.5% to 25.8%) and Estonia (from 33.8% to 33.0%).

In 2017, taxes on production and imports made up the largest part of tax revenue in the EU (accounting for 13.6% of GDP), closely followed by net social contributions (13.3%) and taxes on income and wealth (13.1%). The ordering of tax categories was slightly different in the euro area. The largest part of tax revenue came from net social contributions (15.2%), ahead of taxes on production and imports (13.2%) and taxes on income and wealth (12.8%).

Looking at the main tax categories, a clear diversity prevails across the EU member states. In 2017, the share of taxes on production and imports was highest in Sweden (where they accounted for 22.7% of GDP), Croatia (19.6%) and Hungary (18.2%), while they were lowest in Ireland (8.5%), Germany (10.7%) and Slovakia (11.1%).

For taxes related to income and wealth, the highest share by far was registered in Denmark (29.7% of GDP), ahead of Sweden (18.9%), Belgium (16.9%) and Finland (16.6%). In contrast, Lithuania (5.4%), Bulgaria (5.7%), Romania (6.1%) and Croatia (6.3%) recorded the lowest taxes on income and wealth as a percentage of GDP .

Net social contributions accounted for a large proportion of GDP in France (18.8%), Germany (16.7%) and Belgium (16.1%), while the lowest shares were observed in Denmark (0.9% of GDP) and Sweden (3.3%).

(Cyprus News Agency)

Top Stories

U.S. federal agency greenlights Biden’s presidential transition

The U.S. General Services Administration (GSA) on Monday told Joe Biden it was ready to begin the formal presidential transition process for him. GSA Administrator...

Cabinet to decide on Wednesday about measures against COVID-19

Cyprus Government Spokesman, Kyriakos Koushos, has told CNA that the Council of Ministers will decide on Wednesday about what will happen as regards the...

Delays in the arrival of postal items due to decrease of flights

The Cyprus Post would like to inform the public that due to the Coronavirus outbreak, a significant decrease of flights to and from Cyprus...

Cost of electricity to be reduced in 2022, RES fee must be revised

The cost of electricity is expected to be reduced in 2022, as the market opens to competition and the project to bring natural gas...

Russia says its Sputnik V Covid-19 vaccine is 95% effective

Russia's Sputnik V coronavirus vaccine is 95 percent effective according to a second interim analysis of clinical trial data, its developers said on Tuesday. The...

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...