Value added tax evasion and excise duty fraud on fuel market in the Czech Republic

Abstract

SEMERÁD, P.: Value added tax evasion and excise duty fraud on fuel market in the CzechRepublic. Acta univ. agric. et silvic. Mendel. Brun., 2012, LX, No. 2, pp. 335-340 This paper deals with analysis of current problems in the motor fuel market. It analyzes bottlenecks in setting the legislative changes in value added tax, excise tax and the legislation concerning fuels. The biggest problem is tax evasions that favor one group of business entities at the expense of another, and also cause that the state loses revenues mainly from indirect taxes. Therefore, attention is directed to quality control of fuels as a means of consumer protection and prevention of tax evasion and ways to combat tax evasion in import, distribution and storage of mineral oils. The examples are the most common errors found in fraudulent companies. Based on the data collected the possible ultimate evasion was estimated. Therefore, I propose that value added tax law should be amended and some other measures to improve supervision by public authorities like tax authorities and customs administration offi ces should be taken.carousel frauds, excise duty on mineral oils, quality control, untaxed fuel, value-added tax Motor fuel market in the Czech Republic is rather specifi c from the point of view of taxation. Breakdown of fuel prices is unique compared to breakdown of prices of most other commodities. Besides income tax, personal and corporate, taxpayers have to pay excise tax on mineral oils set at a fi xed rate and value added tax which varies depending on the sales price. Even in the past, this element of the Czech market was aff ected by tax evasions when the names of light fuel oils were confused and then they were sold at petrol stations as diesel fuel. The Czech Republic and also other member states of the European Union are looking for eff ective tools to combat tax evasions or at least to reduce them as much as possible.

Chemical Laboratory Support for Customs: Vegetable Oils Added to Diesel Fuel a Case Study

“…Despite this, customs and financial police operations (World Customs Organization, 2015, 2016Mobili & Parente, 2014;Di Benedetto, 2016;Pasqualetto, 2015;Pubants, 2016) highlight that automotive diesel fuel continues to be the most attractive product to fraudsters because of its high commercial value. Once again, eastern Europe is a critical source of fraud in the mineral oil sector that now touches the majority of the EU (Semerád, 2012).…”

The Repayment of the Excise Duty on Green Diesel as Tax Support for Agricultural Production in the Czech Republic

“…By illegal mixing fuel is blended with chemical substances, compounds and mixtures that have similar technical characteristics but a lower rate of the excise duty are exempt from taxation entirely or partially (these components are destined for off -road use or for disposal) (Semerád, 2012 According to farmers a simpler classification of diesel could help in this situation. A sufficient criterion could be the quantity of methyl ester given on the tax document and its consistency with the norm ČSN EN 590.…”

How to Avoid the Usual Price Rule on the Fuel Market in the Czech Republic

“…The problem of fuel quality was mentioned as well. Illegal mixing is defi ned as a process of deliberate modifi cation of chemical composition and physico-technical properties of fuel which does not comply with applicable legal and technical standards (Semerád, 2012b).…”