Week in Insights: AirPods Are at Center of EU Carousel Fraud Case

Curated by Daniel Xu

Investigations across eight European countries culminated late last month in the arrest of a ringleader in an AirPods “carousel” tax fraud worth 85 million euros (about $93 million).

Those committing carousel frauds, also known as missing trader intra-community frauds,sell goods to a purchaser-importer in another member state that doesn’t charge a tax. The purchaser-importer must perform a “reverse charge,” informing its taxing authority that it has imported the goods, and pay the requisite value-added tax—obviously, fraudsters never do. The purchaser-importer then sells the goods to a third party, collecting VAT on that ...