Customs fraud costs EU dear
Thursday 13 March 1997
Europe's spreading "grey" economy is feeding a new criminal underworld, creating a dangerous culture of dependency and depriving the union of much-needed revenue. The inquiry into the failure of the EU transit system and transit fraud, chaired by John Tomlinson, a Labour MEP, will undermine confidence in the creation of a border-free Europe.
Criminals based in East Europe are exploiting lax policing of customs and tax systems because member-states have failed to compensate for abolition of border controls by updating crime-fighting systems and sharing information. Four years after the abolition of border controls, member-states continue to act as 15 separate entities, providing a free-for-all for the criminals.
The report calls for a common customs investigation body and a centralised customs intelligence office to fight fraud, and computerisation of the entire transit system.
Cigarettes are the biggest business for customs fraudsters, the report says. "A container-load of cigarettes carries a potential fiscal value of about 1m ecu [pounds 700,000]. Almost all of this is potential profit for the smuggler." The report focuses on the "community transit system", by which goods from outside the EU move through member-states.
The tax system set up for such goods involves 18 million operations a year, all by paper and open to fraudsters. Goods such as cigarettes or alcohol are simply unloaded clandestinely en route and placed on the black market.
Nobody knows the extent of the fraud, says the report. Estimates vary by billions from country to country. The fraud poses a big threat to the livelihoods of those working for companies operating in the "legitimate economy", putting jobs at risk, says the report.
"More insidious is the malign influence of the `grey' economy, which is fed by transit fraud and customs fraud in general. This parallel economy thrives at the expense of the legitimate economy, leading to unemployment and slower growth." The inquiry team heard of evidence of a link between the sluggishness of the "official economy" and expansion of the "grey" economy.
- 1 Tidal launch: The most pretentious lines from Alicia Keys' valedictory speech
- 2 Trevor Noah: Jon Stewart's replacement faces online criticism over 'anti-Semitic' tweets
- 3 Martha Stewart accuses Snoop Dogg of 'smoking for four hours' during Justin Bieber Roast
- 4 Gamers confess the worst things they've done in The Sims
- 5 Syrian child photographed 'surrendering to camera because she thought it was a gun'
Costa Concordia: Shipment of Mob drugs was hidden aboard cruise liner when it hit rocks off Italian coast, investigators say
Martha Stewart accuses Snoop Dogg of 'smoking for four hours' during Justin Bieber Roast
University of Cambridge: Remains of 1,300 scholars are found under building
Jeremy Clarkson 'could be given minder' ahead of a potential Top Gear return
Turkey power cut: Prime Minister says nationwide blackout could be caused by terrorists
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
Street preacher quoting from the Bible fined for calling homosexuality an 'abomination'
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
The West has it totally wrong on Lee Kuan Yew
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
Revealed: Putin's army of pro-Kremlin bloggers
£14000 - £16000 per annum: Recruitment Genius: Due to expansion, this multi-ac...
£21000 - £34000 per annum: Recruitment Genius: This is an opportunity for an e...
Negotiable: Recruitment Genius: This leading supplier of compliance software a...
£24000 - £30000 per annum: Recruitment Genius: The Associate System Engineer r...