Value added tax system and dynamics of rate in the period of European Union crisis

Abstract

Purpose - the article aims to assess the economic efficiency of value-added tax as the prime indirect tax. The analysis focuses on flaws of the current value-added tax system; ways to eliminate the flaws and make European Union-wide improvements in the system are discussed. In her research article, the author also presents the research of the value-added tax rate dynamics in the European Union and assessment of value-added tax rate changes in Lithuania and Great Britain during the crisis. Design/methodology/approach - descriptive method, analysis of scientific literature, statistical analysis of data, analytical method, mathematical analysis, analysis of legal instruments, and comparative analysis. Findings – the author focuses on current scientific debates on ways to improve the value-added tax system according to the European Commission. In her article, the author presents the research of value-added tax rate dynamics in the European Union and the significance of value-added tax for the European Union budget revenue. Research limitations/implications – in the next paper would be added the most recent data, now they do not exist. Practical implications – the paper presents the theoretical framework for further study of value-added tax in European Union as basic material for classroom use. Originality/Value – the author presents the research of value-added tax rate dynamics in the European Union during economic crisis.