Sector calls for legal certainty and more control against fuel fraud
Legal certainty and more control to prevent fraud, these were some of the demands put on the table during the conference ‘Fraud in fuel distribution: a problem for everyone for which there is a solution’, organised by AEVECAR, AOP, CEEES and UPI at the headquarters of the CEOE.
These fraudulent practices not only harm the public coffers - last year the State lost over 1,000 million euros in VAT revenue - but also generate unfair competition, hence the need to adopt urgent measures to put an end to them and ‘denounce them to the point of exhaustion, because you can never be an accomplice’, stressed Víctor García Nebreda, secretary general of AEVECAR.
The conference was opened by the president of the CEOE, Antonio Garamendi, who stressed the importance of the companies in the sector themselves, more than 4,700 and 200,000 workers, being the ones to bring this debate on fraud ‘which encourages unfair competition and is detrimental to the business sector’. Garamendi recalled the great challenge they have to meet the 2030 emission reduction targets and how 80% of investments are going to come from the private sector, hence the need ‘to ask for special protection where we demand legal certainty’. For the CEOE president, ‘there is no sustainability without progress and no progress without sustainability’.
Juan José Blanco, a partner at KPMG Abogados, then explained how this fraud occurs and how serious it has become, not only because the corresponding VAT is not paid, thus reducing the State's income, but also because it means the expulsion of legal operators from the market, little by little, due to the impossibility of maintaining competition.
In terms of possible measures to try to tackle this fraud, he highlighted the inversion of the taxable person, a solution that requires time to be approved, and which means that the fraudster would only receive the sale itself, so that by not paying the VAT he would not be able to play with this tax; the splitting of payment, already adopted in some countries such as Poland; delimiting certain products so that, in addition to presenting the 380 form, payment of the VAT quotas corresponding to the product is guaranteed; or being a reliable partner for the Tax Agency. He also advocated a more agile Tax Agency.
The cases of Portugal and Italy
But this problem does not only affect Spain, as countries such as Portugal and Italy have also been affected by this fraud. In the case of Portugal, Antonio Comprido, secretary general of APETRO, pointed out that fraudsters take advantage of certain legal and market weaknesses. If in Spain it is VAT, in Portugal, he stressed, the problem starts with fossil biofuels, which have a higher price, so the biggest problem is competition.
Comprido stressed that they have been working with the government for more than ten years to find solutions, but that they are faced with legislation that is not sufficiently robust, with few control procedures, with a lack of coordination between administrations and with the slowness of the justice system, hence, he said, the need to improve legislation.
For her part, Marina Barbanti, director general of UNEM, stressed that in Italy, fuel fraud damages not only the state, but the entire sector through unfair competition, but that in 2012-2013 the market changed and there was a boom in operators, which meant that important control tools were introduced, ‘before that, fraud was 6%, now we are between 1-2%’, she said.
Barbanti stressed that it is essential, once the problem has been detected, to ‘fight it as quickly as possible’ and said that the implementation of alert and control measures together with large investments in digitalisation have been very effective, establishing synergies with the administrations.
Finally, she indicated that ‘we must always be alert because fraud evolves’, and that the measures introduced against fraud affect not only taxation, but also security and the environment.
Unfair competition
The day concluded with a round table discussion with the participation of Víctor García Nebreda, secretary general of AEVECAR, Javier Albares, president of the AOP Anti-Fraud Commission, Jorge de Benito, president of CEEES, and Luis Nieves, president of UPI, moderated by the deputy director of El Economista, Rubén Esteller. All the speakers denounced the serious problem posed by these fraudulent practices, not only because of VAT fraud, but also because of unfair competition, and called for greater control by the government, since the measures adopted to date are not sufficient.
Among the proposals to eradicate this fraud that were put on the table were: the payment of VAT before fuels can be extracted from the depots; the obligation to settle VAT monthly; increased controls and monitoring of operators; greater legal certainty; financial guarantees for those who want to enter the market; and speed in the processing of cases. ‘We want control and reliability,’ García Nebreda stressed.
Luis Nieves insisted that there is ‘fraud running into millions’ and that we are facing a very important problem that not only affects the sector, but also the State, the taxpayer and all citizens. He defended legal competition and the implementation of a model similar to the Italian one in the short term. "The measures are totally insufficient. We are faced with total defencelessness,’ he said.
Víctor García Nebreda recalled that the measures introduced in the Royal Decree Law of 8/2023, of 27 December, to combat fraud, which states that ‘in no case is supply between retail distributors allowed, nor supply from retail distributors to wholesale operators’, are not being effective, as these practices persist in the market, which is why he advocated more controls on the operator, the wholesaler, in order to have greater reliability. ‘The decree has prevented everyone from selling to everyone, but it is insufficient,’ said García Nebreda, who also emphasised how this situation ‘affects the customer's perception of our business’.
He proposed the creation of a working group, as already exists in countries such as France, to be more informed and to be able to work with the Administration in a coordinated way, as well as more legal measures so that the work of the Guardia Civil or the Tax Agency ‘is much more effective’. The AVECAR secretary general concluded by encouraging people to ‘always denounce’ because they cannot ‘be an accomplice’.
Jorge de Benito wanted to highlight the importance of this problem with the terminology used by the Civil Guard: criminal organisations, kidnapping, extortion, arrests, millions of litres of the product, blocking of accounts ..... And he insisted that it is not only a fraud for the sector, but also for the buyer... ‘What we are asking the administration for are tools’, he indicated.
For his part, Javier Albares was also in favour of the Italian model and insisted on the need for legal certainty in the medium term in order to know how to act and to be able to comply: ‘We need a regulatory framework and also control measures’. For the AOP representative, ‘something is happening in the licensing of operators,’ he said, noting that 83 are disqualified.
Albares also highlighted the feeling of impunity, because it seems that the good guy is the one who sells the cheapest, a message that permeates and creates a feeling that is very different from reality, he said. ‘When the mafias get into society with their tentacles, they reach very far, it is not only an economic problem, it is also a social problem,’ he said.