The carousel trade (arbitrage)

Short summary

Two secretly-linked companies exploit VAT rules: company A imports phones and sells to company B with VAT charge; company B claims VAT refund on export, creating a carousel fraud scheme that extracts government revenue.

• •VAT arbitrage through controlled import-export between related entities
• •Company B reclaims VAT from government on re-export despite no value-add
• •Illustrates regulatory gap where beneficial ownership transparency is lacking

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