Carousel fraud involves a person registering in one EU member state in order to obtain goods free of VAT, often from another member state, but sometimes from outside the EU. The registered person fails to account for VAT on selling the goods and ‘absconds’ before the tax authority carry out any control visits or checks. At its most extreme, it involves the same goods circulating from member state to member state, sometimes being taken outside the EU, with VAT being stolen on each circle.
Measures to stop carousel fraud
The measures to try to stop carousel fraud include: