EU to Fight VAT Tax Evasion

August 19, 2009 Taxation in EU  No comments

The European Union has called for steps to be taken by its member states in order to fight Value Added Tax fraud.

In an effort to reduce Value Added Tax (VAT) fraud, the European Union has urged its member states to increase inter-jurisdiction cooperation. In an effort to foster this, the European Commission has proposed a new set of protocols under which information can be shared between countries within the European Union.

The primary development in the proposition is the establishment of Eurofisc. This is a proposed system under which its member states will be able to quickly share taxation information. The aim is to create a system whereby taxation fraud is reacted to in a timely manner and also prevent the proliferation of future tax fraud schemes. The quality of tax data collected, in terms of inter-country comparability and usability, has also been encompassed in the proposal with a framework already been created to handle the issue.

In regards to the proposition, László Kovács, Commissioner for Taxation and Customs for the European Commission, said “In the current economic situation it is more important than ever to fight tax fraud efficiently and a fully functioning administrative cooperation between tax administrations is key in that respect. My objective is to ensure that tax authorities have all technical and legal means to take action against European Union wide VAT fraud and to ensure that each tax administration is prepared to protect other Member States’ tax revenue as effectively as their own.”

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