TAX Cobra, a special financial law enforcement unit, has revealed a major tax fraud scam pertaining to a fictitious business dealing in natural stone, which could have deprived the state of €40 million. A total of 67 firms are involved in the case, and the investigator has accused 26 people, the TASR newswire reported on May 19.

According to František Imrecze, head of the Financial Administration, this is one of the biggest cases that Tax Cobra has dealt with so far. It dates back to 2008.

“It has the characteristics typical of carousel fraud; it is a very extensive case of tax fraud,” Imrecze said, as quoted by TASR.

The main organisers of the fictitious business were Slovaks. They bought the rough stone, which they later sold to other companies that claimed to have processed it, which increased its value. The companies then sold the stone, but did not pay the VAT.

“Those who were to pay VAT in this case never paid it, since the company disappeared or was rewritten under the name of someone who could not be contacted,” said Daniel Čech from the Financial Administration, as quoted by TASR.

The purchasers of the stone subsequently asked for excess tax refunds, since they were exporting the goods abroad to the Czech Republic and Serbia. In the end, the stone was returned to Slovakia and used in another sale.

The police have already carried out searches of 29 homes, 22 of which were in Slovakia, five in the Czech Republic and two in Serbia. Seven of the 26 people accused were taken into custody, Police Corps President Tibor Gašpar told TASR.

If found guilty, they could spend from seven to 12 years in prison.

Source: TASR

Compiled by Radka Minarechová from press reports

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