Models of Cross-Border VAT Fraud

Silvia Fedeli and Francesco Forte

No 123, Working Papers in Public Economics from Department of Economics and Law, Sapienza University of Roma

Abstract: The EU market's free circulation principle severs the VAT chain at the EU States' borders, thus, enticing VAT frauds. The increased "transit traffic" from outside EU with final destination in EU also contribute to VAT fraud. To examine this issue, we model some different collusive characters of these frauds, on which basis we explore their effects on the international trade and the domestic market.

Keywords: European Union Value Added Tax; income tax and VAT evasion; VAT carousel; Nash equilibrium fraud-chain (search for similar items in EconPapers)
JEL-codes: H24 H26 (search for similar items in EconPapers)
Pages: 25
Date: 2009-06
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Citations: View citations in EconPapers (5)

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