The Legal and Institutional Analysis of Tax Crimes from EU and Comparative Perspectives

Abstract

The fight against tax crimes and other financial crimes such as corruption requires a combination of national and cross-border use of relevant laws and institutions. Nonetheless, it is necessary to address the deficiencies in individual and collaborative arrangements and find out if and what strengths therein can be exploited by the EU Member States. Using socio-legal and comparative research methodologies, this chapter addresses the above issues through exploring the relevant EU legal instruments as well as institutions that seek to counter crime against the financial interests of the EU and its Member States. A careful look at the EU’s counter financial crime ecosystem reveals that Directive (EU) 2017/1371 (PIF Directive) and Council Regulation (EU) 2017/1939 (the EPPO Directive) are part of a cocktail of progressive measures by the EU to tackle financial crime. Although most EU Member States have agreed to criminalize VAT fraud and related crimes, VAT against the financial interest of the EU is still pervasive. Also, a comparative study of the legal framework of the EU Member States involving definitions, prosecution routes, sanctions, and liability of both natural and legal entities for tax crimes shows not only the pervasiveness of tax crimes but also the disparities and similarities of approaches in countering these crimes. The chapter concludes that EU criminal policy on financial matters needs to be enhanced including the extension of the criminalization to VAT fraud under ten million euro and an active role of the EPPO with reference to these offences.