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DRAFT REPORT (2025/2121(INI))

On combating VAT fraud – the effectiveness of cross-border cooperation when it comes to VAT fraud and its impact on the EU budget

CONT-PR-789092

Committee on Budgetary Control · Rapporteur: Ondřej Knotek

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✦ In short · AI summary of this text, generated 16 Oct 2026

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This draft report by Parliament's Committee on Budgetary Control calls for stronger EU action against cross-border VAT fraud, especially carousel fraud, and for the anti-fraud architecture to be reformed for the post-2027 multiannual financial framework. It asks the Commission to give the European Public Prosecutor's Office and the European Anti-Fraud Office direct access to VAT information systems, to strengthen Eurofisc and its transaction network analysis tool, and to extend the reverse charge mechanism. It calls for a legislative package revising the rules on the European Anti-Fraud Office, the European Public Prosecutor's Office, Europol, Eurojust, Eurofisc and the PIF Directive, and for better recovery of fraudulently diverted amounts. It also asks the Commission to tackle import VAT fraud, crypto-asset use in carousel schemes, and risks in the Emissions Trading System Phase 2 and the VAT in the Digital Age package.

Committee position. The rapporteur proposes that Parliament call for a stronger EU anti-fraud architecture for the post-2027 multiannual financial framework, including direct VAT data access for the European Public Prosecutor's Office and the European Anti-Fraud Office, a binding legislative package revising the anti-fraud rules, and better recovery of fraudulently diverted amounts.

Key points

  1. Reaffirms calls for coordinated EU action against cross-border VAT fraud, stronger administrative cooperation, and reconsideration of the EUR 10 million threshold in Article 2 of the PIF Directive.
  2. Says the next multiannual financial framework and its sectoral regulations must contain robust anti-fraud provisions, and warns that financing not linked to costs needs safeguards.
  3. Calls on the Commission to create a common governance framework for anti-fraud actors, a unified reporting system, and greater use of digital tools.
  4. Demands direct, automated and centralised access for the European Public Prosecutor's Office and the European Anti-Fraud Office to VIES, Eurofisc and the Central Electronic System of Payment Information, with clear procedural guidelines.
  5. Calls for Eurofisc's transaction network analysis tool to be developed with AI-assisted pattern recognition, and for Member States to provide transactional data on time.
  6. Says VAT registration checks matter most, and calls for the reverse charge mechanism under Articles 199a and 199b of the VAT Directive to be retained, extended and broadened beyond 2026.
  7. Calls for DAC8 crypto-asset reporting data to be accessible to Eurofisc, the European Anti-Fraud Office and the European Public Prosecutor's Office, and for a Commission assessment by 2028.
  8. Calls for a vulnerability assessment of carousel fraud and financial crime in Emissions Trading System Phase 2, and for its launch to be postponed if risk is high.
  9. Calls for VAT in the Digital Age reporting data to be interoperable with Eurofisc's tool and accessible to the anti-fraud bodies, with a Commission report by 31 December 2031.
  10. Wants the anti-fraud architecture review to produce a binding legislative package revising the rules on the European Anti-Fraud Office, the European Public Prosecutor's Office, Europol, Eurojust, Eurofisc and the PIF Directive.
  11. Calls for clearer complementarity between the European Anti-Fraud Office and the European Public Prosecutor's Office through binding information-sharing protocols and automatic referral triggers.
  12. Calls for a structured monitoring mechanism on follow-up to convictions and recommendations in VAT cases, reporting amounts recovered versus amounts recommended, and for action on Customs Procedure 42 and the Import One-Stop Shop.

Who is affected

  • Member State tax administrations, which would need to strengthen cooperation and provide transactional data to Eurofisc.
  • The European Public Prosecutor's Office and the European Anti-Fraud Office, which would gain direct access to VAT information systems.
  • Europol and Eurojust, whose mandates would be expanded for VAT fraud cases.
  • Crypto-asset service providers, which must report transaction data to national tax authorities from 2026 under DAC8.
  • Non-EU e-commerce operators, whose misuse of import VAT mechanisms is identified as a source of revenue loss.

Figures and deadlines

  • EUR 128 billion: the estimated EU-wide VAT compliance gap in the 2025 VAT Gap Report.
  • EUR 12.5 billion to EUR 32.8 billion: estimated annual cost of carousel fraud to the EU.
  • EUR 45 billion: revenue fraud amount exceeding this figure in the European Public Prosecutor's Office 2025 annual report.
  • 86 %: share of damage in organised crime cases attributed to organised criminal groups.
  • EUR 10 million: threshold under Article 2 of the PIF Directive that Parliament wants reconsidered.
  • 2030: deadline for e-invoicing and real-time digital reporting for intra-Community business-to-business transactions under the VAT in the Digital Age package.
  • 2028: deadline for the Commission to report on whether DAC8 crypto-asset data has helped identify VAT fraud proceeds.
  • 31 December 2031: deadline for the Commission to report on VAT in the Digital Age data use in cross-border VAT fraud detection.

Legal basis: Articles 310(6) and 325(5) of the Treaty on the Functioning of the European Union, and Article 4(3) of the Treaty on European Union.