Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)
Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)

Author(s): Dagmar Halabrinová, Karel Brychta
Subject(s): Economic policy, EU-Accession / EU-DEvelopment, Fiscal Politics / Budgeting
Published by: Masarykova univerzita nakladatelství
Keywords: European Union; harmonization; immovable property; tax rate; VAT;
Summary/Abstract: The aim of the paper is to identify and systematize selected rules contained in the Council Directive 2006/112/ES on the common system of value added tax relating to taxation of immovable property and subsequently, while using cluster analysis, to divide EU Member States into groups according to VAT tax rates applicable. To identify the relevant legal norms contained in the Council Directive 2006/112/ES the legal regulation as valid and effective as to 01 January 2017 was taken into account. To carry out a classification of the EU Member States, the data published by the European Commission was utilized. For the reasons of cluster analysis, five possible VAT objects were taken into consideration (social housing, renovation and repairing, building land, supplies of new buildings and construction work on new buildings). On the basis of results reached one can observe that there is a relatively high variability in the rules established in legal regulations covering issues connected with immovable property. A presumption as to the utilization of exceptions and discretion given to the Member States can be considered as valid. At the same time the results reached prove that Member States can be divided into several groups that demonstrate high similarity in VAT taxation of immovable property.

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