Amazon and eBay warned by MPs about VAT fraudsters
|bbc.com 18 Oct 2017 at 00:00|
The report estimates up to £1.5bn has been lost from third-party sellers on online marketplaces not charging the tax on sales they make in the UK.
MPs in the Public Accounts Committee criticised HMRC for being "too cautious" in pursuing the "fraudsters".
Amazon and eBay said they were working with HMRC on the issue.
Labour MP Meg Hillier, who chairs the committee, called online VAT fraud "hugely damaging" for British businesses and taxpayers.
She added that "the response of HMRC and the marketplaces where fraudsters operate has been dismal".
The fraud has increased because foreign firms selling goods to UK shoppers - usually via online marketplaces like Amazon and eBay - are keeping some of their stock in UK warehouses to provide next day delivery.
If items are dispatched from UK soil, the sellers have to charge VAT at 20%.
But many have not been, so undercutting genuine UK suppliers and reducing tax revenue, the committee s report found.