Dáil Éireann - Volume 458 - 14 November, 1995
Written Answers. - VAT Evasion.
Mr. Dempsey Mr. Dempsey
79. Mr. Dempsey asked the Minister for Finance if his attention has been drawn to the fact that Northern fuel merchants are purchasing briquettes in  this State which are VAT exempt and then selling these briquettes on the local markets in unfair competition against local fuel merchants; the plans, if any, he has to counteract this; and if he will make a statement on the matter. [16906/95]
Minister for Finance (Mr. Quinn) Ruairí Quinn
Minister for Finance (Mr. Quinn): I am advised by the Revenue Commissioners that since the introduction of the single market, EU law provides for intra-Union acquisitions whereby a VAT registered trader in one member state may obtain VAT zero-rated goods from another member state, and account for VAT on those goods in his own member state. One of the conditions of such a transaction is that the goods in question must be removed from the member state in which they were obtained, otherwise the vendor in that member state becomes liable to account for the VAT due.
Because of the ease with which abuses of such provisions could arise, I am advised by the commissioners that a series of legislative and procedural arrangements have been put in place to safeguard the VAT system. For example, traders in each member state are obliged to furnish a quarterly return-known as a VIES return here and an ESL return in the UK — to their tax authorities, of all their zero-rated supplies to traders in other member states.
Special mutual assistance arrangements facilitate transmission of the material between national authorities so that a trader's quarterly return can be cross checked with the normal VAT returns of the traders in receipt of his supplies.
As a result of complaints received in 1993 and 1994 about VAT evasion arising from cross-Border trading between here and the North, a systematic programme of visits by inspectors of taxes to various targeted sectors around the country was carried out. That programme resulted in the regularisation of the VAT status of traders concerned, where this action was appropriate.
 Information is exchanged on an ongoing basis between HM C & E, Belfast and our VAT authorities, via the VIMA office in Dundalk about traders on both sides of the Border involved in VAT evasion.
A previous complaint was made about one particular fuel merchant from Northern Ireland who was alleged to have purchased briquettes at the zerorate from Bord na Móna and sold them in this State. Inquiries to Bord na Móna have revealed that they examined the records of the company in question and found that all consignments of briquettes purchased in the State had been dispatched to the company's depot in Northern Ireland, and that all subsequent sales to fuel suppliers in this State had been correctly invoiced.
However, if the Deputy could supply the names of the fuel merchants referred to in this parliamentary question to the VAT administration branch, indirect taxes division, Revenue Commissioners Office, Dublin Castle, Dublin 2, the matter will be investigated and appropriate action taken. The information provided will, of course, be treated in the strictest confidence.
Dáil Éireann 458 Written Answers. VAT Evasion.