July 20, 2006

EU Fraud

It has been known for some time that VAT is a fraud magnet. It is hopelessly overcomplicated, but we have to have it because of the EU. So when a proposal comes along to try and simplify it and make it less fraud prone you would expect that it would be welcomed. Not a bit of it.

Austria had proposed reforming VAT so that it would basically be transformed into a form of Sales Tax. This would make the most common and damaging from of VAT fraud impossible. But the EU Commission, unelected, unaccountable, and not exactly squeaky clean historically about fraud and graft themselves, have the ultimate say over this tax. And they say no. It is almost as if they like that the everything the EU touches turns into a mechanism for large scale fraud


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