It's the same concept as buying products manufactured in the US; you're not going to get them cheaper in Europe just because your money won't go as far there. The producer has to think about their profits.
It's not, though. You charge similar amounts for manufactured products, because there is a cost to manufacting them, which you have to cover along with your profit. You often do profit less off each item sold at countries where the purchasing power lower, because that allows you to sell more units and make up for the smaller margin.
Considering there is zero cost of manufacturing on Riot Points - free users and paying ones consume Riot's resources at roughly the same rate - Riot wants to maximize the RP sold * Cost per RP. They have single market with all the European users, and assuming they want to keep the same prices for everyone due to technical reasons, perceived fairness of the system, etc. it makes a lot of sense to price the RP for the richer countries. Cause they actually pay good money for it.
Now, VAT is a bit more interesting, because despite seemingly increasing the cost of RP, it really doesn't. It's more like a flat out 18.7% cut to Riot's profits. Despite the VAT, pricing for when RP sold * Cost per RP(including VAT) is at highest maximizes Riot's profits. That is, the VAT shouldn't directly affect the pricing - assuming US has currently optimal prices(RP sold * Cost per RP is maximized), and 25% VAT was introduced, dropping prices by 20% to match keeps the optimal pricing and would allow for Riot to keep making most profit.
Obviously, this ignores the other effects such as changes to the compareable goods and purchasing power and whatnot that a VAT increase would have. Just in general, looking only at max profits when determining pricing is huge simplification, but for when comparing pricing between two regions for the same good, a lot of the normal pricing objectives don't really apply.
So why charge EU customers more? Because that's what compareable goods do. You have to pay US price + VAT for games, so the value for RP is higher for EU customer than US one. EU customer is willing to pay more for the same, so Riot charges more. Or maybe more accurately, EU customer is willing to pay the same for less.