- Bulgarian financial consultants in Ruse have been helping Romanian businesspeople commit VAT fraud and embezzle funds from the EU.
- The scam was uncovered by OCCRP partner Context and Bulgarian platform BIRD.
- The consultants used the “missing trader intra-community” method (MTIC) to exploit zero tax rules for trade between EU members.
- Perpetrators establish shell companies, engage in VAT-free trade, and evade legal action.
- MTIC is one of the most common forms of tax evasion in the EU, costing nearly 50 billion euros annually.
- Romanian prosecutor Laura Codruta Kovesi stated that cross-border tax evasion has been tolerated and ignored by many EU states.
- Romania has the largest VAT gap among member states, failing to collect 36.7% of expected contributions in 2021.
- Ruse-based consultants aided Romanian businesspeople in setting up firms in Bulgaria and participated in significant tax frauds.
- Some schemes involved embezzling European Structural and Investment Funds by inflating the value of imported goods.
- Romania’s national tax collection authority identified 140 fraud cases involving Bulgarian companies, causing damages exceeding 250 million euros.
- The Romanian government is considering measures like tax increases and spending freezes amid financial struggles.
- Kovesi emphasized the importance of prioritizing the fight against organized crime and cutting off their funding.
Source: occrp.org
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
