Nicholas Hallam has once again written for Financial Director, this time regarding the growing trend known as responsibilisation.
Amazon and eBay have been in the press recently because of a concern that their warehousing arrangements is depriving HMRC of millions of pounds in unpaid VAT. Nicholas’ article looks at the issues surrounding the notion that the UK government could decide to hold marketplaces responsible for the non-compliance of their clients:
…it is patently unjust: why should third parties be held accountable for the failings of their clients? Secondly, it is massively counter-productive. If fraudsters know that tax authorities will pursue soft third party targets for missing revenue, what is the deterrent against committing fraud?
He also stresses that responsibilisation is not merely theoretical; in December HMRC raided a warehouse and seized over £500,000 of goods because they suspect were illegally being offered to UK online shoppers at VAT-free prices.
Read the full article here.