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Combating VAT fraud: Lessons from Korea?

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  • Combating VAT fraud: Lessons from Korea?
  • Krever, Richard
  • Monash University


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Title Combating VAT fraud: Lessons from Korea?
Similar Titles
Material Type Reports
Author(English)

Krever, Richard

Publisher

[Clayton , Australia]:Monash University

Date 2014-07
Series Title; No British tax review
Pages 13
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Financial Policy
Government and Law < Laws and Legislation
Holding SSRN

Abstract

Adopted a decade after the commencement of VAT in the UK, the Korean VAT was largely modelled on the European precedent and most features of the tax have parallels with the traditional VAT. In two significant aspects, however, the Korean VAT diverges from its European counterparts. The first aspect is the collection of comprehensive data on sales and purchases by the revenue authority, along with the administrative practice of comprehensive matching of supplier and customer invoices. This approach has been a feature of the Korean system from the time of its adoption. The second aspect is the more recent creation of a “cash receipt” system that rewards final consumers paying by cash if they insist on a cash receipt that automatically reports sales to the revenue authority. The latter system appears to have achieved some positive results in terms of reducing non-disclosure of cash sales. (The rest omitted)