HMRC steps up carousel fight with VAT change
Government hopes to have VAT changes in place by December
As part of its ongoing battle against carousel fraud, HM Revenue &
Customs has said that it hopes to have reverse charge accounting on certain
goods in place by December.
The change will mean that businesses buying mobile phones, computer chips and
other electronic goods will have to take responsibility for accounting for VAT
HMRC hopes that this change in the way VAT is accounted for will place a
brake on the rampant increase in carousel fraud. HMRC plans to have the new VAT
regime in place by the beginning of December, but the change is dependent on
EU’s derogation of the 6th EU VAT directive.
It is estimated that carousel fraud costs the Exchequer between £1.2bn and
£1.9bn a year.