A TRIAL has been hearing details of a scheme used by fraudsters to siphon off millions of pounds in VAT.
Roderick Stone of HMRC explained the operation to a jury at the High Court in Edinburgh on the second day of the trial of Dundee businessman Shahid Ramzan, 40, of Broughty Ferry.
Mr Stone said the trick is that an importer sells on goods charging VAT but not actually paying it. Eventually the goods, after passing though the hands of several companies, are exported again. The exporter then claims back, and receives, a VAT refund from what appears to be a genuine transaction.
But because the refunded VAT hasn't been handed over in the first place, HMRC makes a loss. As the same commodities can go round and round from importer to export broker and back again, the scheme is known as a carousel fraud, said Mr Stone.
Ramzan denies a charge brought under the Proceeds of Crime Act alleging that he took steps to hide, transfer or remove from Scotland a total of almost £115 million. He is also accused of cheating the tax man out of about £6m, which he also denies.
The trial continues.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article