Luxembourg VAT Fraud Investigation
An estimated 50 Billion euros in tax money goes missing from EU countries each year due to VAT fraud. A cross border investigation stipulates that Luxembourg plays a part in this massive scale fraud. According to “Grand Theft Europe”, which is an investigation conducted by 63 journalists from 30 countries coordinated by research centre corrective.org. The article cites an example of a man called Amir Baha (whose name has been changed for the article), who became a multimillionaire off selling mobile phones, game consoles and CO2 emissions certificates overseas without paying VAT. This is known as “VAT carousel” whereby one person purchases a product from another country at 0% Vat and sells it on in another country along with a 19% sub-charge. However, instead of passing the surcharge on to the tax office, the seller keeps it for themselves. This practice started 25 years ago and is known to be widespread.
According to Luxembourg Journalist Lauren Schimit, the 18 strong Luxembourg anti-fraud department is struggling to tackle this issue which is just one part of their job, and stresses that there needs to be more co-operation between member states on tax issues to help overcome this problem.
Amazon offers employees a business proposition if they leave their jobs
Following Amazon’s plans to speed up its shipping time from two days to one for its Prime members, Amazon has decided to offer its employees a proposition by asking them to quit their job, and in return, they will help the employees start up a business delivering for Amazon. The programme is open to full-time, and part-time employees including warehouse workers, and those who qualify for the program will be covered for up to $10,000 in start-up costs and receive three months of their salary from Amazon. The new employee incentive is part of a program that Amazon introduced last year that lets anyone apply to launch an independent Amazon delivery business, which is to help the company take more control of managing their deliveries rather than relying on carriers.
Amazon’s Vice President John Felton, president of global delivery, stated that over more than 200 Amazon delivery firms had been created since the launch of the programme last year
Electronic Marketplaces to Submit VAT Returns on Behalf of Sellers
With the introduction of the “Growth Decree,” there’s been a few changes that have been adopted by the Italian Government which will affect VAT treatment for electronic marketplaces such as being responsible for VAT submission, tax due on distance sales which are the ones that resonate the most. Therefore e-commerce market places shall submit VAT returns to the tax authority on behalf of its online sellers and should be submitted by July 2019. Also, by not abiding the new regulation, electronic marketplaces will be held responsible for the tax due on distance sales unless they can prove that the supplier had already paid the fee. Although the provisions of Legislative Decree 135/2018 apply only to distance sales of mobiles phones, laptops, tablets, PCs and game consoles, those of the DL 34/2019 apply for distance sales of any type of goods, if made through online platforms.