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How to Avoid the Usual Price Rule on the Fuel Market in the Czech Republic

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  • Pavel Semerád

    (Department of Accounting and Taxation, Faculty of Business and Economics, Mendel University in Brno, Zemědělská 1, 613 00 Brno, Czech Republic)

Abstract

The paper deals with value added tax evasions on the fuel market in the Czech Republic. This commodity is used in carousel fraud. In the chains of taxpayers there are missing traders who fail to meet their tax obligations. Their business strategy is based on quick sales at unusually low prices which do not allow honest parties to compete. Tax administrators should focus on unusual prices which constitute a higher probability of tax evasions. This paper aims to verify whether or not there are ways to evade the measure, focusing specifically on applying methods which could help achieve lower sales prices while avoiding the possibility to require unpaid tax from the recipients of taxable supply. The weaknesses thus found are described and demonstrated in more detail in the paper. During a research some ways were found which could be used for avoiding this specific measure. Methods of Cash Back and Free Shipping were identified and described.

Suggested Citation

  • Pavel Semerád, 2016. "How to Avoid the Usual Price Rule on the Fuel Market in the Czech Republic," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 64(1), pages 351-355.
    • Handle: RePEc:mup:actaun:actaun_2016064010351
    DOI: 10.11118/actaun201664010351
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    References listed on IDEAS

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    1. Slemrod, Joel & Yitzhaki, Shlomo, 2002. "Tax avoidance, evasion, and administration," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 22, pages 1423-1470, Elsevier.
    2. Tanzi, Vito, 1999. "Uses and Abuses of Estimates of the Underground Economy," Economic Journal, Royal Economic Society, vol. 109(456), pages 338-347, June.
    3. Benno Torgler & Christoph A. Schaltegger, 2005. "Tax Morale and Fiscal Policy," CREMA Working Paper Series 2005-30, Center for Research in Economics, Management and the Arts (CREMA).
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