VAT-refund fraud by companies costs Bt2 billion
The Revenue Department has accused 50 companies for allegedly defrauding the state of about Bt2 billion in value-added tax, while some of their officials were arrested in the course of investigations in Samut Prakan and Samut Sakhon where the highest refu
Director-general Prasong Poontaneat said yesterday that the scam involved more than 50 juristic persons, which joined to illegally obtain Bt600-million VAT refunds that benefited exporters of computer products.
The ring also produced fake tax invoices for more than Bt1 billion. Damage is estimated at about Bt2 billion in total.
The group set up the companies for VAT refunds in 2011. Their transactions were made through commercial bank transfers among computer exporters to make it seem as if payments for product purchases were made. Then, the exporters obtained and filed for the VAT refunds.
The department sought cooperation from its counterparts in other countries, including China, Hong Kong and Laos, for evidence of export declarations, and found that no such buyers existed.
According to the Customs Department, the exporters were suspected of corruption, as the products were not similar to those identified in the export declaration form.
The department joined with police to search 12 locations, mostly in Samut Prakan, Bangkok and Pathum Thani. Ten people were arrested and are being investigated. More arrests are expected.
The department is also being investigated for collusion with the network of alleged fraudsters.
If convicted, tax-invoice fraudsters will face a jail term of three to seven months and a fine of Bt2,000 to Bt200,000.
Bt7 billion loss
From 2011 to the present, the tax-refund fraud has caused total damage of about Bt7 billion. The biggest case was for exporters’ VAT refunds for a total of Bt4.1 billion and the damage could not be recovered until now.
Prasong said he has proposed a legal amendment that would allow the department to conduct investigations and freeze financial transactions of alleged wrongdoers. The National Council for Peace and Order has given the green light for the proposed amendment and the legal draft is being checked by the Council of State.
The Revenue Department sent a letter to the Customs Department seeking its cooperation in examining more than 10 export products suspected of involvement in the tax-refund fraud.
Tax revenue in August was Bt4 billion lower than the same month last year and Bt30 billion less than targeted due to the end of the first-car rebate programme.
Tax revenue this fiscal year is expected to run Bt30 billion lower than in 2013 and about Bt120 billion less than targeted. The tax revenue target for the next fiscal year has been set at Bt1.96 trillion.
