TaxCorporate TaxCarousel fraud bill to reach £5bn

Carousel fraud bill to reach £5bn

Grant Thornton estimates massive cost of VAT fraud

VAT ‘carousel’
fraud
will cost the cost the government at least £5bn this year, according
to a study by mid-tier firm Grant
Thornton
.

The firm made what it called a ‘conservative’ estimate based on official data
showing sharp falls in the fraudulent activity in the past couple of months.

Grant Thornton said the estimate of £5bn was likely to be reached even if the
final quarter of this year sees a substantial decrease in the scale of fraud.

‘The economic impact of [carousel] fraud continues to have a significant
negative impact on the UK economy,’ said
Stephen
Gifford
, the firm’s chief economist.

‘Even on a conservative estimate we forecast losses to HM Treasury will
amount to £5bn in 2006. That represents around one penny on the basic rate of
income tax,’ he added.

Further reading:

French scupper UK’s anti-carousel fraud efforts

Britain’s carousel fraud battle suffers European blow

Carousel fraudsters sent down for 34 years

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