Estonia grapples with VAT fraud

Estonia has introduced a number of measures to help eliminate VAT fraud – an €222m problem for the newest member of the Euro currency.  This is causing an increasing compliance burden on local and foreign businesses.

Anti VAT fraud measures include:

• Limits on VAT reclaims for the purchases of vehicles
• An extension of VAT refund repayment timetable with interest accruing to 60 days
• New domestic Intrastat reporting, listing sales and purchase above €1,000

The last measure follows similar new domestic reporting requirements for local and VAT registered non-resident EU companies in Hungary and Slovakia.