VAT Fraud and Evasion: What Do We Know and What Can Be Done?

By Michael Keen, Stephen Smith. National tax journal, 2006

280 citations recorded by the source corpus.

Like any tax, the VAT is vulnerable to evasion and fraud. But its credit and refund mechanism offers unique opportunities for abuse, and this has recently become an urgent concern in the European Union (EU). This paper describes the main forms of noncompliance distinctive to a VAT, considers how they can be addressed, and assesses evidence on their extent in high-income countries. While the practical significance of current difficulties in the EU should not be overstated, administrative measures alone may prove insufficient to deal with them, and a fundamental redesign of the VAT treatment of intra-community trade may be required. The current difficulties in the EU largely reflect circumstances that would not apply in the U.S.

Subfields: Accounting, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/5b2dcbfcfddcb5c1e8808401e2a6612dd798d46c

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Citations in the corpus

No Taxation Without Information: Deterrence and Self-Enforcement in the Value Added Tax (2015, unknown): “[22] Keen, Michael and Stephen Smith.”
'Fiscal Devaluation' and Fiscal Consolidation: The VAT in Troubled Times (2012, background): “Nickell, Stephen, and Richard Layard, 1999, “Labor Market Institutions and Economic Performance,” in Handbook of Labor Economics, ed. by Orley Ashenfelter and David Card, Vol. 3C, (Amsterdam: North-Holland).”