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Nationwide tax fraud racket in meat industry uncovered
By:
thinkSPAIN , Monday, February 22, 2016

A MASSIVE tax-fraud swoop involving the national meat industry right down the production line has led to at least 73 companies in 15 of Spain's 17 regions raided.

Producers and wholesalers, including Mercabarna and Mercamadrid have come under scrutiny, with at least 25 directors and managers taken in for questioning.

A huge sum of money in cash and several computers have been seized.

Inquiries started over a year ago when the profits of around 3,000 different firms did not appear to match up with company tax declarations.

Typically, the sale price in supermarkets is around four or five times those paid at source because of the work involved, but this was not reflected in the sums reported to the tax authorities.

Investigations revealed large amounts of cash paid into current accounts in the names of these companies or by their owners personally, as well as sizeable assets held abroad and lavish lifestyles that did not seem to be possible given the directors' recorded earnings.

Later, undeclared sales came to light – particularly at the retail end of the production line where most of the police raids have taken place – after IVA (VAT) declarations did not appear to tally.

A full analysis has shown that although the firms in question recorded an aggregate annual turnover of about €650 million, the profit margin was barely 1% - well below the average for the industry – and nine firms even reported losses.

The amount of cash which changed hands is estimated to be around 11% of total turnover, although in the case of some firms, as high as 50%.

Two companies even dealt 85% and 94% respectively of their turnover in undeclared cash.

As yet, it is not thought any official arrests have been made, or anyone charged, but company bosses are being interrogated.

 

 

 
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