[Info-vax] HP stopping VMS paper documentation ?

[Paul Sture]

On Tue, 06 Dec 2011 20:36:49 +0000, glen herrmannsfeldt wrote:

> As I understand VAT, the distributed (through the chain of sales) method
> means that there is less incentive for any individual to cheat, and if
> one does the loss isn't as big.  The sales tax system requires a more
> concentrated enforcement system.

There are still ways to cheat the VAT system that make it worthwhile.  A 
few years ago there was a large scam in the UK with the import and/or 
export of mobile phones (non-existent phones IIRC) which ran to the tune 
of hundreds of millions.

One of the features of the VAT system that many don't appreciate is that 
it provides an audit trail right from manufacturer to end consumer.

It can be self correcting in a way, in that if someone decides to trade 
off the books (i.e. cash in the back pocket), they cannot claim the VAT 
back on purchases (at least not without risk of getting caught), so in 
effect the tax is paid at that point.

> The penalties for cheaters have to be high enough in either case to
> discourage those who might cheat.

The UK VAT used to be part of Customs and Excise, with the draconian 
powers they have.  You certainly didn't want to mess around with them.
It's since been merged into the rest of the Inland Revenue, but I can't 
see that being a happy union due to inter-departmental rivalries. :-)



-- 
Paul Sture