The Carousel Value-Added Tax Fraud in the European Emission Trading System

27 Pages Posted: 15 Nov 2012

See all articles by Maria Berrittella

Maria Berrittella

University of Palermo - CIRPIET

Filippo Alessandro Cimino

Università Kore di Enna

Date Written: November 14, 2012

Abstract

In this article, we analyze the effects of the carousel value-added tax fraud in the European carbon market and the legislative measures that the EU Member States could adopt to deal with this phenomena. We use a computable general equilibrium model, called GTAP-E and the version 6 of the GTAP database to evaluate the economy-wide and terms of trade effects. The policy test has been designed for five European countries: Belgium, France, Germany, Italy, Netherlands and the United Kingdom. According to our findings, the legislative measures aimed to remove the VAT fraud in the European Emission Trading System will have positive effects in terms of GDP and welfare in the selected EU Member States.

Keywords: domestic emission trading, general equilibrium analysis, legislative measures, value-added tax fraud, welfare

JEL Classification: C68, H26, K34, Q58

Suggested Citation

Berrittella, Maria and Cimino, Filippo Alessandro, The Carousel Value-Added Tax Fraud in the European Emission Trading System (November 14, 2012). FEEM Working Paper No. 75.2012, Available at SSRN: https://ssrn.com/abstract=2175482 or http://dx.doi.org/10.2139/ssrn.2175482

Maria Berrittella (Contact Author)

University of Palermo - CIRPIET ( email )

Viale delle Scienza
Palermo, 90128
Italy

Filippo Alessandro Cimino

Università Kore di Enna ( email )

Via delle Olimpiadi
Palermo, Enna 94100
Italy

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