Spain cracks gang running multi-million euro carbon tax fraud

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Spanish police said Tuesday they had broken up a criminal gang running a multi-million-euro fraud that dodged import and carbon taxes on the sale of refrigerated greenhouse gases.

In a series of raids, police arrested 27 suspects and seized 110 tons of different kinds of gas worth 11 million euros.

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The gang specialized in the “illegal traffic in greenhouse gas refrigerants” that damage the ozone layer, said a police spokesman.

The gang brought the gases in from China at the port of Valencia on Spain’s east coast, passing it off as being intended for other destinations such as Jordan, said the statement.

In fact, the refrigerant gases stayed in Spain and were sold in various regions across the country.

The gang exploited the fact that European businesses have the right to transit goods imported from non-EU countries through EU territory - where they are intended for a third country - without having to pay customs duties.

They set up a ghost company in Portugal that was the fictional recipient of the gases from Spain, in case customs agents inspected their goods, said the police statement.

The gas was in fact being sold on the black market in Spain at about three times less than the normal market price.

The gang had got out of paying import duty and paying the tax applied to the European market for carbon quotas, as well as a Spanish tax on greenhouse gas refrigerants.

Spain’s treasury estimates that the fraud cost the taxpayer 3.5 million euros in tax revenue.

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