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VAT: Fraud

Question for Treasury

UIN 12215, tabled on 4 February 2020

To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the effect of online VAT fraud on small businesses; and if he will make a statement.

Answered on

12 February 2020

The Government is determined to ensure that all businesses pay the tax that is due, and it is well aware of the potential for VAT losses that may arise when overseas businesses fail to comply with UK VAT rules, and the disadvantage for domestic businesses.

The Government has therefore taken action to make online marketplaces responsible for VAT losses as a result of fraud and error on their sites. HMRC have now issued over 10,800 joint and several liability notices to online marketplaces resulting in the removal of non-compliant sellers. These measures act as a strong deterrent to overseas businesses evading VAT.

The Government will continue to monitor the success of these interventions and will continue to look at alternative methods to address this issue.

Answered by

Treasury