Economic crime report 2004 - Ekobrottsmyndigheten

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A conservative estimate for 2002 would put the figure at 4.5%, or over SEK 100 billion. The National Accounts periodically undergo retroactive revisions. For 2000, uncollected revenues stemming from undeclared work are estimated at SEK 56 billion. According to current National Accounts data, the undeclared sector represented approximately 5% of the GDP in 1988-2000. The conservative 4.5% estimate for 2002 yields an undeclared sector of SEK 105 billion and – based on the previous assumptions – uncollected revenues of some SEK 70 billion stemming from undeclared work. See Table 2. Table 2 Schematic calculation of the total amount of tax error in 1997 and an updated calculation for 2000, SEK billion Tax error, SEK billion National Updated Share of Tax Board calculation total taxerror 1997 2000 1999 Income tax, VAT and social security contributions 60.4 56 64% Tax on capital investments abroad ? 7.5 9% Audit results – primarily non-deductible costs and different forms of wrong accounts and wrong tax calculation Random audits of ordinary taxpayers and companies, except the biggest groups of companies 20.8 25.3 ? Coordinated audits of the biggest groups of companies 20 16 ? Selective purchase taxes on alcohol, tobacco, oil, etc. 3.0 3.4 4% Loss of VAT through electronic trade on the Internet ,, 0.5 0.60% Plain fraud against the tax administration, e.g., claiming VAT repayments ,, ,, Total tax error, SEK billion 83.8 88 100% Total tax error as a percentage of GDP (SEK 1 800 billion in 1997 and SEK 2 083 billion in 2000) 4.7% 4.2% Total tax error as a percentage of taxes in the public sector (SEK 950 billion in 1997 and SEK 1 100 billion in 2000) 8.8% 8.0% On behalf of the Tax Base Inquiry, SKV estimated uncollected revenues linked to international transactions at SEK 20-30 billion, as broken down in Table 3. 18
Table 3 Estimated tax error linked to international transactions Special sales tax SEK 2–4 B VAT SEK 5–10 B Tax on capital (incl. Inheritance and gift tax) at least SEK 8 B Tax haven transactions by companies SEK 2–5 B Miscellaneous (internal pricing, e-commerce, social security contributions, etc.) ? Total SEK 20–35 B The SKV <strong>report</strong> indicated that the lower estimate of SEK 20 billion for uncollected revenues linked to international transactions was consistent with the previous assessment of total uncollected revenues of up to SEK 90 billion. Based on the higher estimate of SEK 35 billion, the total figure would need to be adjusted upward as well. All in all, uncollected 2000 revenues in Sweden appear to be in the neighbourhood of SEK 100 billion. Impact of Tax Evasion Tax evasion has many different consequences, not all of them undesirable. The most serious injurious effects are not deemed to be on revenues collected, but on social morale and democratic institutions owing to unintentional redistribution of the tax burden. Moreover, there is a danger that inefficient businesses that evade taxes will crowd out their more efficient rivals. 2.5.4 Evading Selective Purchase Tax Selective purchase tax is levied on specific goods and services. Total collected revenues for 2003 were approximately SEK 88.3 billion. Since selective purchase tax is a means of influencing consumption and production patterns in addition to providing a source of revenue, they are in a state of constant change. Mineral oil, alcohol and tobacco – the products subject to harmonized selective purchase tax – are covered by the EU’s suspension system. Under specified circumstances, the system permits the products to be manufactured, stored, processed and shipped among Member States without any tax liability accruing. Only when they are available for consump- 19
Page 1 and 2: ECONOMIC CRIME REPORT Report no. 20
Page 3 and 4: Economic Crime Report
Page 5 and 6: Government Swedish Ministry of Just
Page 7: Economic Crime and Efforts to Comba
Page 10 and 11: Economic Crime - Current Status and
Page 12 and 13: Economic Consequences of Economic C
Page 14 and 15: Interagency Cooperation Measures Th
Page 16 and 17: Undeclared Work • Employers who h
Page 18 and 19: A CLOSER LOOK AT UNDECLARED WORK, V
Page 20 and 21: VAT Fraud There is always a risk th
Page 22 and 23: Trends Over the Next Three Years Fo
Page 24 and 25: Concluding Remarks The purpose of t
Page 27 and 28: Contents 1. Introduction 6 2. Curre
Page 29 and 30: 10.5 NATIONAL CRIME PREVENTION PROJ
Page 31 and 32: Table 31 Number of decisions by oth
Page 33 and 34: 2. Current Status of Economic Crime
Page 35 and 36: detected offences are documented, a
Page 37 and 38: sentative of both commercial goods
Page 39 and 40: mentary evidence for verifying actu
Page 41 and 42: SKV put together documentation to l
Page 43: that a certain volume of uncollecte
Page 47 and 48: The minimum tax rates on alcohol ar
Page 49 and 50: • Businesses, such as: - Tax plan
Page 51 and 52: According to the court of appeal, t
Page 53 and 54: loan prohibition, the Accounting Ac
Page 55 and 56: 4. It has a definite focus, though
Page 57: “A number of groups are engaged i
Page 60 and 61: Council and its task force have con
Page 62 and 63: Special joint consultation groups f
Page 64 and 65: 4. Intelligence and Monitoring Oper
Page 66 and 67: The total money involved in transac
Page 68 and 69: Intelligence Operations of Tax Crim
Page 70 and 71: Graph 13 Number of audits, 2000-200
Page 72 and 73: 2002 to 2003. The sums involved in
Page 74 and 75: Money Laundering, etc. A newly esta
Page 76 and 77: Since the project started on 1 Apri
Page 78 and 79: Manipulated cash registers are the
Page 80 and 81: professional criminals to one degre
Page 82 and 83: official figures. In the autumn of
Page 84 and 85: ookkeeping offences continued to ac
Page 86 and 87: Graph 25b Total number of reports o
Page 88 and 89: Graph 26 Cases received, 1998-2003
Page 90 and 91: Table 30 Number of decisions by EBM
Page 92 and 93: Graph 34 Average throughput time fo
Page 94 and 95:
6.5 TAX CRIME UNITS Expansion of ta
Page 96 and 97:
Graph 38 Trading prohibitions, 1998
Page 98 and 99:
9. Attachment, Collection, etc. The
Page 100 and 101:
Graph 43 Unpaid taxes and fees (SEK
Page 102 and 103:
Since a coordinated effort to recov
Page 104 and 105:
According to the proposals, the age
Page 106 and 107:
and employers concerning registrati
Page 108 and 109:
suggest that attitudes are continui
Page 110 and 111:
84 • a regional informational pro
Page 112 and 113:
12. International Contact and Coope
Page 114 and 115:
13. Skills and Methods Development
Page 116 and 117:
Since the autumn of 2002, EBM has c
Page 118 and 119:
nesses under their control, grant l
Page 120 and 121:
social insurance offices could prev
Page 122 and 123:
15 Problem Areas and Future Threats
Page 124 and 125:
• higher unemployment • distort
Page 126 and 127:
15.3 UNDECLARED WORK IN CASH SECTOR
Page 128 and 129:
EBM’s pilot project on measures f
Page 130 and 131:
15.5 AGENTS WHO AID ECONOMIC CRIME
Page 132 and 133:
ied out indicate that most transact
Page 134 and 135:
Appendix 1 CHANGES PROPOSED BY SAME
Page 136 and 137:
SKV • SKV should have limited aut
Page 138 and 139:
Transport Workers’ Union VAT Info
Page 140:
Reported economic crimes have incre
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