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The volume of MTIC fraud between Poland and Czechia in electronic devices trade: general method of carousel fraud estimation

Author

Listed:
  • Miroslav VaÅ¡koviÄ
  • Hana Zídková
  • Markéta Arltová

Abstract

EU member states are discussing the phenomenon of carousel (MTIC) fraud. Existing estimates of this type of VAT evasion are sparse and the methodology behind them is unclear. This paper describes a method of how to estimate (ex-post) the MTIC fraud realised within a trade on selected goods. The analysis is based on trade balances in the selected category of goods between two member states. The main assumption is that after the implementation of the specific reverse charge mechanism the MTIC frauds on the respective goods are eliminated. The fictitious (fraudulent) supplies of goods between the member states cease to exist and the trade balance changes accordingly. The results show that the MTIC realised EUR 44-51 million profit on the MTIC fraud in international trade between Poland and Czechia with selected electronic devices in 2014 and 1st quarter 2015 (fraud measured in Czechia).

Suggested Citation

  • Miroslav VaÅ¡koviÄ & Hana Zídková & Markéta Arltová, 2024. "The volume of MTIC fraud between Poland and Czechia in electronic devices trade: general method of carousel fraud estimation," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 20(2), pages 126-145.
    • Handle: RePEc:ids:ijepee:v:20:y:2024:i:2:p:126-145
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