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On the internet site of the European Commission the Commission staff working document versions of the Mind the Gap Reports of the 27 EU Member States have become available. The documents provide an interesting insight into the challenges and opportunities that exist in each of the EU-jurisdictions for tax compliance and tax expenditure.
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Areas of Strength
- Sweden regularly measures a comprehensive range of tax gaps, including those for corporate income tax (CIT), personal income tax (PIT), value added tax (VAT) and excise duties. In addition, the results of these efforts inform and shape the risk compliance strategy of Sweden as they help to identify, assess and prioritise key compliance risks. Moreover, Sweden is among the few Member States that regularly publishes their tax gap estimates across the board on the website of the Swedish Tax Agency which promotes transparency for the activities of the agency.
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Areas of Strength
- Spain’s tax administration shows good results in terms of digitalisation. Advanced IT tools used by the tax administration help manage compliance, prevent fraud and assist taxpayers efficiently. Digitalisation also contributes to enhancing transparency, streamline compliance and strengthening control over tax collection. Among others, it allows the tax administration to generate pre-filled tax returns, cross-check declarations, detect fraud and provide taxpayers with guidance, personalized information and assistance programs aimed at simplifying compliance, such as free online filing tools, pre-filled tax returns or in person assistance.
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Areas of Strength
- Slovenia displays a low VAT compliance gap, supported by a well-established VAT collection and administration system. In 2023, Slovenia’s VAT compliance gap was estimated at 5% of the VAT Total Tax Liability, well below the EU average (9.5%). Notably, Slovenia performs well in the area of VAT registration, deregistration and identification, with VAT registration and return filing being fully digitalised, and the registration process including several risk checks.
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Areas of Strength
- Slovakia has a programme in place to estimate and regularly report on the corporate income tax (CIT) compliance gap. This work is carried out by the Ministry of Finance’s Institute for Financial Policy (IFP) and the Financial Administration. Slovakia does not estimate the personal income tax (PIT) compliance gap. However, Slovakia participates in a joint PIT and social security contribution gap project as part of the TADEUS/FISCALIS cooperation framework at EU level.
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Areas of Strength
- Romania has made important steps to reduce tax expenditures and increase the fairness of their tax system. Exemptions from PIT for workers in certain sectors were abolished in 2025, with the intention of raising revenue and improving the horizontal equity of the system. They have also reduced the maximum income limit to qualify as a microenterprise, which means more companies fall within the scope of CIT.
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Areas of Strength
- Portugal has a well-established workstream on monitoring and reporting tax expenditures (TEs), recently reinforced with the creation of the specialised U-TAX unit. Portugal’s Ministry of Finances reports on TEs since 2014, with disaggregated information since 2021 (relative to 2020) prepared by the Tax and Customs Authority (“AT”). The governance framework provides for evaluation procedures and monitoring obligations. The recently created U-TAX unit within the AT has reinforced the assessment framework on new and existing tax expenditures. It has recently concluded an evaluation of existing TEs to feed into an upcoming RRF-related tax reform.
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Areas of Strength
- Poland performs relatively well in tax collection and recovery. Tax arrears remain below the EU average, having decreased in recent years. This suggests strengthened recovery mechanisms and more effective enforcement actions, including due to increasing reliance on digital tools.
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Areas of Strength
- The Netherlands has a comprehensive tax gap estimation programme which was built over the past few years encompassing both direct tax gap and indirect tax gap estimation. This programme is complemented by a formal compliance risk management strategy in place, which allows for the identification, assessment, and prioritisation of key compliance risks. These complementary efforts have been successful, and The Netherlands performs well in terms of VAT compliance, for example, with a low VAT compliance gap, indicating effective tax collection and compliance efforts.
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Areas of Strength
- Malta’s tax administration is undergoing a modernisation process, building on a relatively good performance in terms of digitalisation. The Malta Tax and Customs Administration (MTCA) is enhancing its technological capacities for better data management and analysis, including by employing Artificial Intelligence (AI) tools. E-filing rates for corporate income taxation (CIT) and personal income taxation (PIT) are slightly above the EU average and, in the case of PIT e-filing, increasing. In addition, the MTCA pre-fills PIT tax returns. The MTCA also provides a variety of online tools and services, and the level of taxpayers’ satisfaction on the support for filing tax returns is among the highest in the EU.
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