Ever decreasing circles?

THERE IS NO doubt about it — VAT has suddenly become a subject of national interest thanks to two key words ... carousel fraud! TV programmes articles in national newspapers highly publicised arrests alarming figures from the Treasury about estimated losses of tax caused by the fraud — rarely has a VAT issue caused such interest. (Although I do remember there was almost a national strike when the government put VAT on take away fish and chips back in the 1980s!)

For most practitioners carousel fraud is something they will hopefully only read about — but it is already clear that HMRC's efforts to reduce the level of fraud have produced implications for many innocent businesses and on the general efficiency of parts of the VAT administration system. In crude terms the tablets are reducing the pain but are having some unfortunate side...