Michaela Merz


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Business sense


I arrived in Frankfurt. As I so often do, I booked my taxi via Uber. It was there, before I could reach the location. My destination was far away from the airport. The trip was correspondingly expensive. With Uber I have noticed that the trip from the airport to the destination is a third to a half cheaper than the identical distance back to the airport. Regardless of the time of day. However my main concern was the return trip.


I knew that I would be travelling at the peak traffic hour and that right through the centre of the city. Therefore I asked my driver how much time I should reckon with in the late afternoon to be at the airport by 6.00 p.m. To my great surprise he said it didn’t make any difference. So, problem solved. He offered to pick me up. I thought that was a good offer. After all I knew the price in advance and I was aware that he would earn his money without the Uber service charge. That was also OK. But when I receive such offers, I am sceptical. Who knows whether he will really come. But at 5.00 p.m. after all my meetings, he arrived punctually at the agreed meeting place and was waiting for me. I asked him the price in order to avoid any negative surprise at the airport. I was greatly surprised when the price was much less than I had paid in the morning. But then I was sitting in the car and was on the way to the airport.

I asked him how he came to the price and he explained to me that he didn’t have to pay a charge to Uber and also any other taxes. That made me suspicious. I didn’t want to be any part in tax evasion, but I realised that my power is very limited. I tried to reassure myself with the fact that perhaps he will declare the income in his tax return, but that worked only for a few seconds. It was clear to me that, given what he had said, that was very unlikely. At the airport I asked for a receipt, but he didn’t have any and didn’t want to give me one. The price fell by another 5 Euros. I paid cash and left the Uber with an uncomfortable feeling. That in this way he earned more for himself than with Uber, was OK for me. After all, Uber had earned well on my first trip.

But defrauding the state made me think, as I had no idea how I could have prevented him. I believe that the state must receive the taxes which are due to it in order to fulfil its obligations. But I am not sure how I would react another time to such a taxi offer. Do I accept? Shall I refuse? What would you have done?

Thommy Weiss / pixelio.de


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Lavrin and the story of lifelong fraud


Lavrin didn’t care much about rules. Where he thought he wouldn’t be caught, he simply ignored them.

He never paid social security contributions for his cleaner and when he became self-employed, he deducted all her wages as business related costs, although she chiefly cleaned his home and cooked for him. He always drove his car too fast, but never fast enough for him to lose his driving licence. He fixed the cruise control so that on the autobahn he never exceeded 139 km/h and in town he never drove above 65 km/h.

When he bought clothes in Milan, with scrupulous precision he cut off all the clothing labels. He claimed refund of the Italian VAT, but he never declared the import for customs and VAT in Switzerland (although his purchases had a value of well over the 300 francs). Continue reading


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EU – Fair Taxation: Commission proposes final technical measures to create a future fraud-proof EU VAT system


The Commission has proposed the detailed technical amendments to EU rules on VAT that supplement recent proposed overhaul of the system to make it more fraud-resilient.

This package of measures substantially modifies the rules relating to VAT and should make life easier for companies across the EU, putting an end to 25 years of a ‘transitional’ VAT regime in the Single Market. Continue reading


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Oracle EBS webcast – Navigating E-Business Suite’s procure-to-pay processing complexity


PwC_Rep_USA_NYC_JFB_0016.jpgI would like to inform you on our upcoming webinar concerning Oracle EBS – Navigation E-Business Suite’s procedure-to-pay processing complexity. Continue reading


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How to improve VAT revenue collection?


Based on figures recently published by the European Commission, VAT revenue collection for 2013 has failed to show significant improvement.

During 2013, the overall VAT Total Tax Liability for the EU-26 Member States grew by about 1.2 %, while collected VAT revenues rose by 1.1 %. As a result, the overall VAT Gap in the EU-26 increased by 2.8 billion Euro and reached a total of 168 billion Euro. Continue reading


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Fighting the tax fraud – Portugal/Spain – Exchange of tax information/Portugal/Espanha – Troca de informação fiscal


On 21 October 2013, Portugal and Spain signed agreements regarding the strengthening of mutual assistance and automatic exchange of information on tax matters. These aim at fighting tax fraud and evasion and the parallel economy. The signed agreements refer to several potential fraudulent situations, including: Continue reading