Slovakia, Czech Republic Target Multimillion VAT Fraud

Authorities in Slovakia and the Czech Republic have carried out coordinated raids in a case involving suspected large-scale customs fraud and VAT evasion linked to imports from China.

The investigation, led by the European Public Prosecutor’s Office (EPPO) in Bratislava and Liberec, centres on nine Czech companies accused of abusing the CP42 customs regime. This mechanism allows VAT exemption on imports if the goods are subsequently transported to another EU Member State where the tax is due.

According to investigators, the companies issued false single administrative documents when importing textiles, footwear and e-commerce goods through ports in Germany, Poland and Slovenia in 2017 and 2018. The goods were then transported to Slovakia, where they entered free circulation.

However, instead of being delivered to the Czech Republic as declared, the shipments were allegedly diverted to other undisclosed destinations. Investigators say many of the transactions existed only on paper, with goods ending up on the black market without VAT being paid. The scheme also involved systematic undervaluation of goods and the provision of false information to customs and tax authorities.

The estimated loss from unpaid customs duties amounts to at least €24.1m ($26.1m), while unpaid VAT exceeds €113.3m ($122.7m) across nearly 4,000 shipments.

(eppo.europa.eu, bak)