European Union and Italian authorities are investigating suspected wide-scale tax fraud by Chinese criminal gangs importing goods via Greece’s largest port of Piraeus, a trade gateway between China and Europe, officials said.
“The [value-added tax] is completely evaded, with enormous damage to the national tax authorities and to the community,” Fabio Botto, of the Italian Central Anti-fraud Office’s special investigative unit, said in an interview.
He said the suspected scam at Piraeus, part of China’s vast Belt and Road infrastructure project, had cost Italy tens of millions of euros in unpaid VAT, adding that the total could be much higher as the investigation is not over.
The European Anti-Fraud Office (OLAF) confirmed it was working with Italy on the investigation but declined to give details, citing confidentiality. Botto said his agency had evidence that Chinese-owned firms run by the criminal groups were fraudulently avoiding import duties and value-added tax on large shipments of goods through Piraeus.
The groups import goods, often counterfeit clothing and footwear, and massively understate their value to EU customs to avoid import duties, he said. They also lie about the firms that receive the goods, enabling them to avoid VAT.
Greece’s Financial Crime Unit is conducting a separate investigation into a suspected tax fraud case involving Chinese goods imported via Piraeus. The Greek unit has had little contact with Italian and EU authorities and has not been informed about the wider investigation, an official there said.
China’s state-owned Cosco Shipping has majority-owned Piraeus since 2016. [Reuters]