Author Archives: vatfraud

Autumn statement tackles VAT Fraud via Fulfilment Houses

The government has just announced in the Autumn statement the Implementation of the Fulfilment House Due Diligence Scheme in 2018 to tackle VAT fraud by overseas businesses selling goods via online marketplaces.

Lets hope Amazon Fulfilment will be held liable of all VAT Fraud being committed from its warehouses. Amazon “Should have known or would have known!!!”

In addition to that the government have given Customs and excise officers new powers to inspect goods.

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Amazon UK bans incentivised reviews

Amazon have just updated their Review policy on Amazon UK & EU. No more free giveaways in exchange for a review.

Chinese  Seller using this technique to boost their product ranking and sales.  Seem’s like Amazon are taking review manipulation seriously.  Shame they don’t take VAT Fraud seriously.

Since Amazon’s announcement yesterday it seems that the mass of Amazon Review Facebook groups have already found a way round the new rule:

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£7,500,000,000 in lost revenue for UK companies, due to the online VAT Fraud that HMRC are failing to stop

The Rt Hon David Gauke MP announced that online VAT fraud accounts for up to £1.5billion of the total VAT gap. However it’s costing a lot more than that; £1.5billion of evaded VAT equates to £7.5billion in lost sales revenue for UK companies.

These UK companies are the ones funding HMRC and paying the £2.4 million pension pot for the most useless ex CEO of HMRC ever; Lin Homer.

The missing £7,500,000,000 is ending up in Chinese bank accounts without any VAT being paid. It’s also completely disappearing from the UK economy with no benefit to anyone other than the VAT Evaders and Amazon & eBay shareholders who are profit from vat fraud.

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eBay Announcement on VAT compliance for overseas sellers is being picked up by Chinese News.

Some interesting news coming out of Chinese News Networks. Seems the latest eBay News Announcement on VAT compliance for overseas sellers is being picked up in China now.

Chinese News website has just (November 15th 2016) published this eBay sellers Note: Failure to follow the rules of VAT account will be frozen.

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Budget March 2016 – Our Response

Having campaigned about on-line VAT Fraud for the past 2 years, it’s welcome news that our campaign is finally on the political agenda and steps are being made to solve the issues.

George Osborne announced a series of measures to combat online VAT Fraud in the March 2016 Budget (starts at 13:01:35). These measures include:

It’s good to see the government has finally acknowledged the scale of the VAT Fraud. In the governments Fulfilment House Due Diligence document David Gauke MP, Financial Secretary to the Treasury is quoted:

“This abuse has grown significantly and now accounts for £1-1.5bn of the total VAT gap. These overseas traders are unfairly undercutting all businesses trading in the UK, abusing the trust of UK consumers and depriving the government of significant revenue.”

However, looking through the proposed changes to the law we have some serious misgivings regarding some of the measures.

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We reported this seller to HMRC VAT Fraud team in 2014. They have now closed down all their accounts and re opened under a new identity WUIHANGWAN TRADE CO., LIMITED, evading all their unpaid VAT and having no stock seized by HMRC – great work. Where is the justice in that HMRC?

HMRC has gifted this seller at least £5,000,000 in unpaid VAT so far. That’s 21% of the total £22.5m budget HMRC have allocated to tackle this fraud over the next 5 years.

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HMRC Incompetence

HMRC has shown a woeful lack of understanding of the scale and risk of VAT fraud now being committed by Chinese and Non EU NETPs on eBay and Amazon.

In July 2014 we handed our detailed report to HMRC VAT Fraud Team and Lin Homer, the CEO of HMRC. We were extremely disappointed to receive a standard letter from Lin Homer asking us to “report anyone we suspected of VAT fraud to the VAT Fraud Team.”

Her response indicated that not only had she completely missed the point of the report, which was to reported several hundred VAT evading sellers, but more importantly to highlight the scale of the problem which was being ignored and mushrooming out of control and was cost the UK £billions in lost revenue.

It is only recently that HMRC have started to take any action against the VAT evading sellers in our report.

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TOMTOP – removed 2017

We reported this seller to HMRC VAT Fraud team in 2014 . HMRC finally took action against them in the summer of 2017.

HMRC has gifted this seller at least £4,000,000 in unpaid VAT That’s 17% of the total £22.5m budget HMRC have allocated to tackle this fraud over the next 5 years

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