Journal of Finance and Accounting

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Carousel Frauds in the Czech Republic

Received: 12 September 2014    Accepted: 07 November 2014    Published: 01 February 2015
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Abstract

Collection of value added tax represents for all EU Member States an important part of the state budget, the share of which is mostly higher than 20%. Growing state expenses and endless economic and financial crisis have resulted in deep dependence on EU Member States revenues from VAT. Organized groups of tax fraudsters abuse the loopholes in current tax legislation to achieve unjust enrichment. This paper describes the practices of tax frauds in VAT collection most frequently used in the Czech Republic, summarizes measures adopted by tax administration and evaluates the effectiveness of their application.

DOI 10.11648/j.jfa.s.2014020602.11
Published in Journal of Finance and Accounting (Volume 2, Issue 6-2, December 2014)

This article belongs to the Special Issue Emerging Trends in Finance and Accounting

Page(s) 1-5
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Taxation, VAT Collection, State Budget, Carousel Fraud

References
[1] European Commission: Council Directive 2006/112/EC of 28th November 2006 on the common system of value added tax
[2] European Commission: MEMO/12/609 of 31st July 2012 VAT: Commission proposes new instrument for speedy response to fraud
[3] Harrison, G., Krelove, R. IMF Working Paper 05/218, VAT Refunds: A Review of Country Experience, 2005
[4] Keen, M., Smith, S.: National Tax Journal, vol. 59, no. 4., VAT Fraud and Evasion: What Do We Know and What Can Be Done? 2006
[5] NKÚ Supreme Audit Office of the Czech Republic, Regulation no. 13_2, 2013
[6] European Commission: Council Directive 2013/43/EU of 22nd July 2013 amending Directive 2006/112/EC on the common system of value added tax, as regards an optional and temporary application of the reverse charge mechanism in relation to supplies of certain goods and services
[7] Czech VAT Act No. 235/2004 Coll.: Adjustment of reverse charge procedure in the provision of construction and assembly work embodied .
[8] The Court - Third Chamber: Teleos plc and others v. Commissioners of Customs & Excise. Judgment of the Court (Third Chamber) of 27th September 2007 case no. C-409/04.
[9] European Commission: Council Directive COM(2012) 428 final, Quick reaction mechanism against VAT fraud.
[10] European Commission: Council Directive COM(2012) 351 final. Communication from the Commission on Concrete Ways to Reinforce the Fight against Tax Frauds.
[11] European Commission: Council Directive COM(2010) 695 final. Green Paper on the Future of VAT Towards a simpler, more robust and efficient VAT system.
[12] European Commission: Official Journal COM(2011) 48 final, Opinion of the European Economic and Social Committee no. 2011/C 318/14 on the Green paper.
Author Information
  • Department of International Trade, University of Economics, Prague, Czech Republic

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  • APA Style

    Alexej Sato. (2015). Carousel Frauds in the Czech Republic. Journal of Finance and Accounting, 2(6-2), 1-5. https://doi.org/10.11648/j.jfa.s.2014020602.11

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    ACS Style

    Alexej Sato. Carousel Frauds in the Czech Republic. J. Finance Account. 2015, 2(6-2), 1-5. doi: 10.11648/j.jfa.s.2014020602.11

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    AMA Style

    Alexej Sato. Carousel Frauds in the Czech Republic. J Finance Account. 2015;2(6-2):1-5. doi: 10.11648/j.jfa.s.2014020602.11

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  • @article{10.11648/j.jfa.s.2014020602.11,
      author = {Alexej Sato},
      title = {Carousel Frauds in the Czech Republic},
      journal = {Journal of Finance and Accounting},
      volume = {2},
      number = {6-2},
      pages = {1-5},
      doi = {10.11648/j.jfa.s.2014020602.11},
      url = {https://doi.org/10.11648/j.jfa.s.2014020602.11},
      eprint = {https://download.sciencepg.com/pdf/10.11648.j.jfa.s.2014020602.11},
      abstract = {Collection of value added tax represents for all EU Member States an important part of the state budget, the share of which is mostly higher than 20%. Growing state expenses and endless economic and financial crisis have resulted in deep dependence on EU Member States revenues from VAT. Organized groups of tax fraudsters abuse the loopholes in current tax legislation to achieve unjust enrichment. This paper describes the practices of tax frauds in VAT collection most frequently used in the Czech Republic, summarizes measures adopted by tax administration and evaluates the effectiveness of their application.},
     year = {2015}
    }
    

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