The EU-VAT (European Union value added tax) is a tax on goods and services within the European Union (EU). The EU’s institutions do not collect the EU-VAT, but EU member states are each required to adopt a value-added tax that complies with the EU-VAT code.
Different rates of VAT apply in different EU member states, ranging from 17% in Luxembourg to 27% in Hungary. The total VAT collected by member states is used as part of the calculation to determine what each state contributes to the “EU’s budget”.