Problems of the procedure 1 The VAT identification number of the person in the other MS is not always mentioned in the SAD This VAT identification number is not automatically checked by the customs at the time of importation No check if the goods leave the territory of the MS of importation to the other MS Non submission of the recapitulative statement by the person importing the goods

Problems of the procedure 2 The fulfillment of the obligation of submission of the recapitulative statement is not a condition for applying the customs 42 procedure No coordination and information exchange between the customs and tax authorities The conditions for the application of this procedure are not fixed at EU level Weaknesses in the national rules

3  The abuse of VAT rules on importation within the framework of carousel fraud is a problem for many MS  The procedure is mostly used between member states with common borders

10. New trend of fraud: Non established companies Directive 2006/112/CE: companies in all Member States can register for VAT in another Member State without having a fiscal representative in that other Member State. Foreign missing traders register in another Member State with the purpose of committing fraud 4

Recent trends detected by the Greek CLO  Owners of enterprises involved in fraud in the past are now employees in new registered companies  Greek companies register for VAT in other MS as non established companies. The Greek companies declare fictitious IC supplies to his VAT number in the other MS and sells the goods in the Greek black market. 5

Recent trends detected by the Greek CLO 6  Greek company and company in another MS registered for VAT. The owner of both companies is the same person (Greek trader) The Greek trader sends textile to the other MS for contract work. When the goods are ready they are sent back to Greece. Normally contract work is a supply of services and shall be taxed in Greece.  BUT the Greek trader issues an invoice of supply of goods, declares intra-Community supplies to the other MS, asks refunds of his input VAT. The company in the other MS issues also an invoice of supply of goods and declares intra-Community supplies to Greece.

How can we fight the fraud?  Pre-registration control, risk assessment of all new registrations, control at the spot  Important to find the missing traders as soon as possible  Immediate de-registration of the missing traders  Post registration control, special monitoring to high risk sectors, to traders not submitting VAT returns, to freight forwarders etc. 7

How can we fight the fraud? 8  Intensive administrative co-operation between the member states  Provisions of joint and several liability  Intensive cooperation between the tax authorities, the anti-fraud units, the custom authorities, the police and the judicial authorities

Actions from the Greek CLO 9  Participation at EUROCANET-AUTOCANET  Seminars and guide manuals to tax officers  Management of audits to traders based on risk criteria  Bilateral agreement with some member states for the exchange of the recapitulative statements of intra-Community acquisitions. Cross-checking with the recapitulative statements of supplies, in case of mismatches the Greek company is audited.

10 It is an obligation for the Greek taxable persons to submit the recapitulative statement of supplies quarterly by electronic means.

11 It is an obligation for the Greek taxable persons to submit the recapitulative statements of acquisitions quarterly by electronic means. For control reasons there are cross- checkings between the VIES data base and the recapitulative statements of acquisitions data base.

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