HMRC given new power to combat VAT fraud

The European Commission has proposed from 31 July 2012 a Quick Response Mechanism (QRM) to combat VAT MTIC, carousel fraud.

Member States would be able to apply, within the space of a month, a “reverse charge mechanism” which makes the recipient rather than the supplier of the goods or services liable for VAT.

In order to deal with possible new forms of fraud in the future, it is also expected that other anti-fraud measures could be authorised and established under the QRM.

VAT fraud costs the EU and national budgets several billion euros every year.  In some serious cases, vast amounts are lost within a very short time.

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