‘Carousel’ VAT fraud costing £35bn in Europe
Fraud costing more than common agricultural policy
‘Carousel’ VAT fraud across the European Union has spiralled to €50bn (£35bn)
with the UK set to lose up to £10bn in 2006, according to The
Guardian.
In the UK this equates to 3p on the basic rate of tax and is costing
governments a total amount more than they spend on the common agricultural
policy each year.
‘This is now the number-one tax fraud. We are losing billions of euros,’ said
the EU tax commissioner, Laszlo Kovacs.
Carousel fraud involves compact, high-value goods such as computer chips and
mobile phones being shipped into an EU country free of VAT.
The tax is added when the goods are sold but is not handed over to the
respective governments.
It attracts organised criminals and terrorist groups because of the huge
profits involved.