Lithuanian e-cigarette company investigated over alleged tax evasion of EUR 800,000

According to reports from Lithuanian media, an e-cigarette retailer based in Kaunas is suspected of evading the payment of over EUR 800,000 in value-added tax (VAT).

Breaking news from Lithuanian media indicates that an e-cigarette retailer based in Kaunas is suspected of evading the payment of over EUR 800,000 in value-added tax (VAT). 

Three employees of the company are suspected of being involved in high-value fraud and the illegal use of taxable goods valued at over 9 million litas. 

Official statements indicate that the investigation is led by the Kaunas District Prosecutor's Office, with support from officials of the Kaunas District Tax Crime Investigation Department (FNTT). 

The investigation was initiated due to suspicions that the company was illegally selling e-cigarettes and the required e-liquids through remote sales on its website, despite Lithuanian laws explicitly prohibiting such activities. 

According to available information, the company's previous website was blocked by the court for illegal sales of e-cigarettes and e-liquids. However, the company subsequently created another website to continue selling products illegally.

The three suspected employees are accused of claiming that these products were sold to companies registered in the European Union in their financial records to evade the ban on selling taxable goods (e-cigarettes and e-liquids) online.

Based on these potential false transactions, the suspects allegedly illegally obtained over EUR 800,000 in VAT refunds. Due to these potential false transactions, a 0% VAT rate may have been incorrectly applied, resulting in the unpaid EUR 800,000 in VAT that should have been included in the national budget.

To gather as much data related to the investigation as possible, FNTT officials searched the residences, vehicles, and boats of the suspects. During a search of one of the suspect's residences, over EUR 900,000 in cash was discovered.

The preliminary investigation, led by Vingaudas Rinkevičius, head prosecutor of the Third Criminal Prosecution Department of the Kaunas District Prosecutor's Office, is still ongoing.

According to criminal law, the strictest penalties are prescribed for illegally obtained high-value external property or property rights, as well as for the illegal use of taxable goods valued at over 9 million litas, with a maximum penalty of up to eight years of imprisonment.

References:

[1] ? teis?saugos akirat? pateko elektronini? cigare?i? prekeiviai: galimai nesumok?ta per 800 tūkst. eur? mokes?i? Read more: https://www.delfi.lt/verslas/verslas/i-teisesaugos-akirati-pateko-elektroniniu-cigareciu-prekeiviai-galimai-nesumoketa-per-800-tukst-euru-mokesciu-94390439