Big Fuel Sellers Propose Measures to Fight VAT Fraud
After reports of increased tax fraud, Statoil said taxmen should be physically stationed at each motor fuel excise warehouse, while Neste proposed that all fuel sellers should be required to publish their entire supply chain on their websites.
Statoil's Estonian sales director Meelis Migur said the fastest solution for getting VAT fraud under control would be to assign tax board representatives to track the transactions at the warehouse and make sure they are at a fair market price.
"Estonia has around 24 excise warehouses, which handle motor fuels. If the tax authority sent a rep to each one and monitored all transactions around the clock, it would cost an estimated 144,000 euros a month. It could seem like a big amount, but the actual payoff would be tens of times greater," said Migur.
The state would otherwise continue to lose 30-50 million euros in VAT plus 20 million euros in excise fraud, said the chains.
The idea of requiring sellers to post all parties handling fuel in the supply chain came from Neste's director Ivar Kohv. He also proposed that filling stations of compliant, tax-paying sellers be allowed to display a label.
"No fraud scheme would work if there wasn't demand, in other words filling stations who buy and sell the fuel," Kohv told uudised.err.ee.
Fuel excise duty is down from usual levels this year, despite an uptick in overall fuel consumption.
The Finance Ministry's official responsible for customs and excise, Marek Uusküla, also commented on the need for increased monitoring.
He told ERR Radio yesterday that one excise fraud scheme was for liquid to be imported as a "product similar to fuel" and later spiked with fuel and other additives and sold as fuel.
He stopped short of criticizing the Tax and Customs Board, saying: "The fuel sector is already an area where tax fraud occurs more often. It is a field that is quite liquid. The goods are sold quickly."