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Belgium: Technical Assistance Report-Revenue Administration Gap Analysis Program–The Value Added Tax

International Monetary Fund

No 2023/166, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper presents the results of applying the Revenue Administration Gap Analysis Program – Value-Added Tax (RA-GAP VAT) gap estimation methodology to Belgium for the period 2011-2021. The RAGAP methodology employs a top-down approach for estimating the potential VAT base, using statistical data on value-added generated in each sector. VAT collections have, on average, remained relatively stable in real terms over the period 2011 through 2021, the period under review for this report, at around 7 percent of gross domestic product (GDP). Like the VAT revenues, the compliance gap, as a percent of GDP, has appeared to be largely stable over the period 2011 to 2021 at around 2 percent of GDP. The compliance gap appears to be largely concentrated in the Professional and Managerial Services sector. The results on the distribution of the compliance gap by sector are not to be considered definitive, only suggestive, and so further analysis needs to be conducted to corroborate or refute these findings and to find possible causes for the noncompliance in these sectors.

Keywords: VAT collection; VAT gap; Gap term; VAT Gap; revenue performance; Tax gap; Value-added tax; Revenue Administration Gap Analysis Program (RA-GAP); Tax expenditures; Europe (search for similar items in EconPapers)
Pages: 38
Date: 2023-05-17
New Economics Papers: this item is included in nep-acc, nep-iue and nep-pbe
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Handle: RePEc:imf:imfscr:2023/166