Amazon and eBay Sellers' VAT Fraud Rife Despite Crackdown (theguardian.com)

Huge numbers of VAT fraudsters are illegally selling goods tax-free to British shoppers on Amazon and eBay, despite new government efforts to crack down on this ballooning 1bn pound VAT evasion crisis, reports the Guardian. From the article: A Guardian investigation found a wide variety of popular goods being illegally sold without VAT on Britain's leading shopping sites. They range from cheap Christmas tree lights, electric toothbrushes and thermal socks to expensive laptops, iPads, music keyboards, violins and pingpong tables. In some cases, VAT fraudsters offer unbeatable prices. Mostly, however, their prices remain in line with law-abiding competitors and the proceeds of evasion disappear overseas, often to China. Guardian investigations found many tax-evading sellers were trading without displaying VAT numbers on Amazon or eBay. Others were showing made up numbers, or numbers cloned, without authorisation, from unsuspecting legitimate businesses.

Comments

Re:VAT?

[Anonymous Coward]

To be honest VAT has always been a disaster waiting to happen, and inside the European Union it is an unmitigated nuisance to enforce.

VAT was first introduced in France as an alternative to income tax. It was introduced in the UK after WWII to fund war reparations. That debt has now been settled - why the fuck UK taxpayers as opposed to Hitlers bankers had to pick up the tab is anyone's guess.

Charging VAT for EU sales is a nightmare. For B2B sales, you need a valid EU VAT number to zero rate for reverse supply. There is no central registry and it can take forever for EU customers to supply this via email. It's also often not properly indicated on invoices when a supplier has done this.

For consumer transactions, you need to identify the country of consumption and charge at the appropriate rate. Every company supplying into the EU should have an EU VAT ID and collect the tax. Not doing so or charging a consumer an incorrect rate is a criminal offence and again, there's no central information source on the different national VAT rates and rules. Add to the stupidity that many people live in one country and work in another.

In short, only the EU could create such a bullshit, unworkable supranational taxation regime.