REVERSE CHARGE REDUCES THE VALUE ADDED TAX DEFICIT

Ciumag Marin and Ciumag Anca
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Ciumag Marin: TITU MAIORESCU UNIVERSITY BUCHAREST
Ciumag Anca: NATIONAL AGENCY FOR FISCAL ADMINISTRATION BUCHAREST

Annals - Economy Series, 2025, vol. 4, 144-149

Abstract: Tax evasion is the evasion of taxpayers from paying taxes and duties by declaring obligations that are lower than the actual ones. In the field of value added tax, tax evasion is the highest. In order to reduce tax evasion in the process of collecting value added tax, the tax authorities have introduced the reverse charge mechanism (simplification measures). Thus, between the supplier and the beneficiary of the sale of goods or services, no payment is made regarding VAT. Moreover, the beneficiary is obliged to collect the tax, to enter it in the invoice and in the purchase journal. In the VAT Return, it is highlighted both as deductible tax and as collected tax. We propose to present the conditions under which reverse charge is applied to VAT, the method of completing delivery documents and their collection, the advantages and disadvantages of applying reverse charge and practical examples of reverse charge.

Keywords: reverse charge; VAT; invoice; supplier; beneficiary. (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:cbu:jrnlec:y:2025:v:4:p:144-149

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