RAVAS     

​Life's like that, isn't it? One moment you are happily running a business and the next you are fighting a desperate battle for survival against state assisted tax abuse. In 2005, after 20 successful years in the music industry, I found myself in the somewhat ridiculous situation of being entirely unable to compete with music retailers that were not charging VAT, when I was obligated to do so. This was simply because they had set up arrangements to supply UK customers with UK sourced physical music products via the Channel Islands.

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In 1998 a company called Play.com first began abusing an exemption from Import VAT called Low Value Consignment Relief (LVCR) and rapidly became one of the UKs leading music retailers. Not having to pay VAT on sales to UK customers gave them a 20% pricing advantage over VAT paying businesses, an entire margin in music retail. Incredibly this obviously abusive arrangement had been permitted and overseen by HMRC, who did absolutely nothing to stop it. Subsequently, the VAT dodging trade grew exponentially, distorting the market to such a degree that both Amazon and HMV were forced to join in and set up mail order operations in The Channel Islands. By 2009 petty much the entire UK music mail order trade had moved offshore!  

 

By 2007 I was unable to compete because I had to account for VAT, whilst my competitors did not, on the exact same products that we purchased from the exact same UK distributors. Some of these products were from my own record label which my VAT dodging competitors were able to obtain from my UK distributor! Like many other UK music retailers I was forced to close my business when it became mathematically impossible to compete.

 

In 2009, I set up Retailers Against VAT Abuse Schemes (RAVAS), a campaign group focussed on ending the abusive Channel Island trade, which by that point had grown into a major industry, selling not just music but flowers, health food supplements, cosmetics, clothing, gifts and many other items. That same year I made a complaint to the EU Commission.  

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After I alerted Members of Parliament and The House of Lords, UK Government Ministers, the media and the EU Commission to the scale of the VAT abuse, HMRC was finally forced to act by withdrawing LVCR from Channel Island mail order goods in April of 2012.

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After a failed legal challenge by The Channel Islands (in which RAVAS was involved as an interested party)  the industry collapsed and UK businesses no longer had to suffer the abusive competition. Furthermore hundreds of millions a year in VAT was saved that would otherwise have been avoided. 

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For the full story see the VAT Loophole website and the excellent piece by Will Dunn published in the New Statesman  The Record Shop, The Taxman and The Missing Billions 

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As a result of my seven year battle to end the Channel Island online mail order VAT scam, I became well known as a tax campaigner and was encouraged to carry on campaigning by businesses that had been helped by my campaign. In 2015 the EU Commission sought my input to their study of the abuse of LVCR (which was abolished in 2021) and that same year together with VATFraud.org I began highlighting VAT evasion that was rife on online marketplaces including Amazon and eBay.

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In 2012 I was surprised to be named in International Tax Review as one of the Global Tax 50 - a list of individuals who made an impact on Global Tax issues that year.  

 

Between 2015 and 2018 I gave evidence to the National Audit Office, the Public Accounts Committee and The Treasury Committee, appeared regularly in the media and on a BBC Panorama documentary The Billion Pound VAT Scam.

 

In January 2021, as a result of continual pressure from RAVAS and VATfraud.org, online marketplaces were made to collect VAT from non-UK sellers by the UK Government. This brought in over £1 billion in VAT in the first year of operation. There are however still major flaws in the system being exploited by the usual suspects, as noted in the 2024 NAO report Tackling Tax Evasion in High Street and Online Retail to which RAVAS also contributed. 

 

It has been gratifying to know that the work of RAVAS has given a voice to businesses in situations where nobody in Government was listening. I still regularly hear horror stories from individuals who approach me desperate to highlight the abusive behavior of an online retailer because they have been ignored by those who are in a position to fix the problem.    

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Here are a few of the supportive comments that I have received over the years : ​

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​​​​The need for RAVAS has not gone away. Threats to fair competition now have an international dimension. RAVAS is going Global.  If you are a business or an individual who is being impacted by the kind of competitive abuse outlined on this website or any other similar anti-competitive issue please contact me and if I can help, I will.