TaxCorporate TaxCustoms in early VAT defeat

Customs in early VAT defeat

Tens of millions of pounds may have to be repaid by Customs after a preliminary European Court overturned Customs' decision not to pay back VAT that had been paid on purchases of computer chips and mobile phones.

Traders await ECJ verdict on VAT clampdown

The decision means that companies such as Bond House, Optigen and Fulcrum, along with dozens of other businesses waiting in the wings, could be due rebates totalling hundreds of millions of pounds.

Dragon Futures, a physical commoditites trader, told Accountancy Age that Customs’ previous stance had left it out of pocket to the tune of £16.5m and forced it to withdraw from the UK, never to return.

Don Mavin, director of the VAT investigations team at accountancy firm, Chiltern, said said the preliminary judgement would give Customs ‘an extremely strong hint’ that the way to tackle carousel fraud is to go after the fraudsters.

‘Today’s decision is excellent news for many businesses who have been inadvertently caught up in this overly aggressive campaign by Customs,’ said Mavin.

‘We have been acting for a number of clients who have been struggling financially, as Customs has withheld VAT owing for over two years now.ÿWe sincerely hope that the European Court will endorse this opinion and see that these innocent parties are refunded what is rightfully owed.’

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