What is carousel fraud?
Carousel fraud or VAT Missing Trader Fraud to give it its proper name, involves importing goods into an EU country from another EU country with the result that they are zero rated for VAT. The goods are then sold on through companies which are liable for VAT before the goods are then exported back to the EU country they originated from. The company that imports the goods incurs a considerable VAT liability as it has to account for VAT charged on the sales and has no VAT repayment claim because the goods were zero rated on import. In a carousel fraud the initial link, the importing company, goes missing and never accounts for the VAT due. The seller having sold on the goods to the next company with VAT included in the price. This type of fraud is believed to have cost UK taxpayers between 1.75 billion and 3 billion during the 2001/02 financial year and is likely to be higher today. What is fraudulent reporting? Fraudulent reporting on its own is at best a waste of police time and at wor
