The Link Between Taxation Indicators at E.U. Level and Economic Development

Paul Vasile Zai
Zai (Tuţă) Gabriela-Maria
Simion-Adrian Purza
JEL codes: 
E62 - Fiscal Policy, E63 - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy.
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.
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