Abstract:
This paper aims at providing a regional approach regarding VAT rate at E.U. level and its links with the level of economic development, using data from Eurostat for the 2004-2013 period. World-wide taxation levels reflect, in a certain measure, the economic state of a particular country. If the tax level within a country is higher, the living standards are also higher, whereas a low taxation level that incites economic growth, will eventually rise. The main indicators considered in the analysis presented in this paper, as most relevant to the subject at hand, are: taxes on income in conjunction with the level of the GDP, business demography, employee compensation, poverty thresholds, income distribution, employment rate and the number of newly founded enterprises.