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Swindlers hide VAT in carbon trading

Swindlers hide VAT in carbon trading

The carousel fraud, a swindle more commonly employed in the trade of mobile phones or computer chips, has entered the trade in carbon permits.
Governments issue permits to industries to emit a specified amount of carbon dioxide. If that industry emits more CO2 than allowed, it must buy credits from another industry that has produced less than it is permitted and has an excess to sell.
In the carousel scam, also known as the Missing Trader Intra-Community scheme, a fraudulent European company buys carbon credits from an EU member country free of value-added tax, then resells the permits to a domestic business with the VAT included in the price.
The importing company then disappears, pocketing the tax without paying it to the government.
In Britain, the standard VAT rate is 15 percent. In the Netherlands, which also has taken action against carousel fraud in carbon trading, VAT is 19 percent.
The British Revenue and Customs office said the potential fraud in VAT receipts for 2005-06 was up to 3 billion pounds.


Updated : 2022-05-28 23:57 GMT+08:00