VAT Fraud : a common concern for business and tax administrations Amsterdam / Schiphol 23 January 2009

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Common minimum standards for registration and deregistration? –In general both tax administrations and business are in favour: –increases mutual trust –increases legal certainty –raise the standard of VIES

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Common minimum standards for registration and deregistration? Registration –Obligation for tax collectors –Needs to be an easy and consistent procedure –Fraudsters will always find a way in but –Consistent screening will minimise fraudulent registration

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Common minimum standards for registration and deregistration? Deregistration –Tax administration more concerned in having a standard timely and rigorous deregistration process –Retrospective deregistration causes significant concerns –VIES needs real time update

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Common minimum standards for registration and deregistration? Long term vision –Home country tax administration to facilitate one single point for foreign registration –Common standard data easier to exchange between Member States / Eurofisc

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Eurofisc –Today only 13 Member States actively co- operate in sharing data –Why? –Member States to be held joint and severally liable if not co-operating? –Member States need to help themselves

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Invoicing rules –No link to VAT fraud –General consensus –Equal treatment based on business internal controls –Common rules for storage, etc. needed –Digital records –Provide a potential win / win

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Exemption of VAT at importation –General consensus –Wide approval –Crucial element in fraud –Normal proof of dispatch rules will apply

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Timeframes for sales listing –General conclusion that multiple options involved have diluted the original proposal –meaningful cross-checking limited –inter-company exclusion difficult –data request must be in line with what the tax authority can practically do with the data e.g. timely –MS can not forbid goods and services reporting on one EC Sales List

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Joint and Several Liability –disconnect between business and Commission Proposal –will this hit the fraudster? –multiple assessments, multiple penalties for honest tax payers –will it improve quality, will it make MS administration more efficient? –burden of proof of innocence with multiple tax administrations

Workshop A : Fight against VAT fraud: a short term approach and the effect on businesses and tax administrations Joint and Several Liability –burden of proof of innocence with multiple tax administrations –gap in understanding –need for further discussion with business –concern over extension to services