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VAT fraud investigations ramp

This time its mobile phones

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Customs & Excise has ramped up its campaign against European VAT fraud and yesterday arrested 10 people accused of a £15 million mobile phone scam. The police and Customs seized both cash and mobile kit in a raid called Ginger, which also involved police in Germany, Denmark, Spain and Belgium. The department has now woken up to the threat, it appears. For the last two years, memory and computer distributors have complained of widespread VAT fraud which has damaged their business and their margins. Alan Stanley, general manager of Dane-Elec UK, which distributes memory, said: “We’re still being hurt by VAT fraud. Now that memory prices are rising, it’s going to happen even more.” There are several variants of the fraud. Sometimes crooks take advantage of different VAT rates in Europe, while at other times they import kit at a zero rate and then charge VAT on products they sell. ®

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