Recent Eurostat data reveals that Cyprus experienced the most significant rise among European Union member states in its tax-to-GDP ratio in 2022. This ratio, which represents the total of taxes and net social contributions as a percentage of the gross domestic product, saw an increase from 34.8% in 2021 to 36.5% in 2022 in Cyprus.

While Cyprus topped the chart with its increase, Hungary followed closely with its tax-to-GDP ratio climbing from 33.9% to 35.1% within the same period. These figures contrast sharply with the tax trends in several other EU nations, where tax-to-GDP ratios were on the decline. Notably, Denmark and Poland experienced the most substantial decreases, with Denmark’s ratio falling dramatically from 48.3% to 42.5%, and Poland’s dropping from 37.6% to 35.3%.

Overall, the European Union's tax-to-GDP ratio slightly decreased in 2022, settling at 41.2% compared to 41.5% in 2021. Within the euro area, however, the tax revenue grew in tandem with nominal GDP, resulting in a stable tax-to-GDP ratio of 41.9% in 2022.

The aggregate fiscal picture of the EU depicts a notable increase in revenue from taxes and social contributions, which rose by 480 billion euros in 2022, reaching a total of 6,549 billion euros. 

The disparity in tax-to-GDP ratios across the EU remained pronounced. France (48.0%), Belgium (45.6%), and Austria (43.6%) emerged with the highest percentages. On the other end of the spectrum, Ireland (21.7%), Romania (27.5%), and Malta (29.6%) reported the lowest ratios.