This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.bbc.co.uk/news/business-46838687

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
Amazon and eBay evict sellers amid VAT crackdown Amazon and eBay evict sellers amid VAT crackdown
(about 2 hours later)
Thousands of overseas sellers have been evicted from online marketplaces in the UK such as Amazon and eBay owing to a tax crackdown.Thousands of overseas sellers have been evicted from online marketplaces in the UK such as Amazon and eBay owing to a tax crackdown.
Businesses, mostly from China, sold items including British flags, phones and fake eyelashes but evaded VAT.Businesses, mostly from China, sold items including British flags, phones and fake eyelashes but evaded VAT.
HM Revenue and Customs (HMRC) sends notices to seven different online sales sites if it discovers businesses failing to pay the correct VAT. HM Revenue and Customs (HMRC) sends notices to online sales sites if it discovers businesses failing to pay the correct VAT.
It said that 4,600 sellers have been "red-flagged" in this way.It said that 4,600 sellers have been "red-flagged" in this way.
If the hosting sites, which also include Asos and Etsy, fail to take action they can be pursued by HMRC for any future VAT that is unpaid. These sites have signed up to an agreement with HMRC. If the hosting sites fail to take action they can be pursued by HMRC for any future VAT that is unpaid. Seven sites, including Amazon, eBay, Asos and Etsy, have specifically signed up to an agreement with HMRC.
The new rules were introduced in 2016, but the crackdown has been stepped up in the last year.The new rules were introduced in 2016, but the crackdown has been stepped up in the last year.
The tax authority said that it had recouped about £200m in VAT after sellers have registered to pay VAT following an alert, officially called a Joint and Several Liability notice.The tax authority said that it had recouped about £200m in VAT after sellers have registered to pay VAT following an alert, officially called a Joint and Several Liability notice.
Since 2016, the number of applications for VAT registration rose to 58,000 compared with 1,650 applications between 2015 and 2016.Since 2016, the number of applications for VAT registration rose to 58,000 compared with 1,650 applications between 2015 and 2016.
"These figures show that HMRC, working closely with the major online marketplaces, is making real headway tackling this serious and damaging evasion," said Mel Stride, financial secretary to the Treasury."These figures show that HMRC, working closely with the major online marketplaces, is making real headway tackling this serious and damaging evasion," said Mel Stride, financial secretary to the Treasury.
CriticismCriticism
Last year, a report by the Public Accounts Committee of MPs said that up to £1.5bn has been lost from third-party sellers on online marketplaces not charging the tax on sales they make in the UK.Last year, a report by the Public Accounts Committee of MPs said that up to £1.5bn has been lost from third-party sellers on online marketplaces not charging the tax on sales they make in the UK.
The committee criticised HMRC for being "too cautious" in pursuing the "fraudsters".The committee criticised HMRC for being "too cautious" in pursuing the "fraudsters".
The fraud has increased because foreign firms selling goods to UK shoppers are keeping some of their stock in UK warehouses to provide next day delivery. Non-UK business selling goods in the UK to UK consumers via online marketplaces are required to register for VAT in the UK, charge VAT of 20% on sales, and account for that VAT to HMRC.
If items are dispatched from UK soil, the sellers have to charge VAT at 20%.