THE VAT SPLIT-PAYMENT MECHANISM, MEASURE FOR COMBATING TAX EVASION IN ROMANIA

Ionut Gheorghe Caraus, Madalina Caraus, Ioana Tatiana Stanese and Gabriela Dobrota
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Ionut Gheorghe Caraus: LUCIAN BLAGA UNIVERSITY OF SIBIU
Madalina Caraus: LUCIAN BLAGA UNIVERSITY OF SIBIU
Ioana Tatiana Stanese: LUCIAN BLAGA UNIVERSITY OF SIBIU
Gabriela Dobrota: UNIVERSITY CONSTANTIN BRANCUSI TARGU JIU

Annals - Economy Series, 2017, vol. 2Special, 47-52

Abstract: The need to improve the methods of collecting and detecting value-added tax amounts is an increasingly difficult process for tax authorities. In this respect, a rigorous analysis of the ways in which the state manages to prevent or combat VAT evasion, in the context in which VAT fraud accounts for about 60% of Romania's total tax evasion, is required. Therefore, the new provisions concerning the VAT split payments, applicable from January 1, 2018 for all categories of taxpayers, can contribute significantly to the efficiency of collection, of the amounts derived from the VAT, as well as to reduce tax evasion in the field of value added tax and providing a fair competitive environment, by eliminating benefits for economic operators with incorrect tax behavior who do not pay VAT to the State budget. Also, through these measures taken by the state, the main motivation for the introduction of the value added tax split-payments mechanism, contributes to the increase of the voluntary compliance degree by providing the financial resources for the payment of VAT due to the State budget.

Keywords: VAT; VAT split-payments; VAT gap; tax evasion; State budget (search for similar items in EconPapers)
Date: 2017
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