The Treasury advises that the above Order has been made and comes into operation on 1 March 2018, and introduces a new penalty against participation in VAT fraud.
The amendment inserts new sections 69C, 69D and 69E into the Value Added Tax Act 1996. The new penalty will apply to businesses and company officers when they knew or should have known that their transactions were connected with VAT fraud.
The new penalty will –
(a) be a fixed rate of 30% for participants in VAT fraud;
(b) apply to businesses but can also be applied to company officers;
(c) give the Treasury the option to name those that participate in the fraud;
(d) not include reductions for disclosure.
The amendments make changes that correspond to those made to the equivalent United Kingdom legislation (the Value Added Tax Act 1994).
