Carbon Trading Permits - VAT fraud gang jailed

By Jonathan Russell, Assistant editor

VAT fraud gang jailed

Three Britons are among six people jailed by a German court for a total of 29 years for evading taxes on the sale of carbon trading permits.

The court found the men guilty of dodging €300m (£250m) in VAT over an eight-month period through what is known as “carousel fraud”. By importing emissions permits without paying VAT and then selling on the assets after adding the tax to the price, fraudsters can pocket the difference or claim back tax that was not paid in the first place.

“The convicted were fraudulently involved in tax-evading trades,” the court was told. “They have brought the carbon market trading scheme into disrepute.”

As is the practice in Germany the full names of those convicted were not relased. However the ringleader of the gang, described as British, was sentenced to seven years and 10 months.

European police have said that VAT fraud cost EU member around €5bn in lost revenues to date.

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