The Finance Ministry and its special inspections service are preparing to come down hard on the rackets profiteering from the illegal trade in fuels, sources say.
The inspectors are said to have tracked at least three such rackets, which, according to conservative estimates by the ministry, deprive the public coffers of about 400 million euros annually. The combined turnover and tax evasion of one racket, discovered recently, appears to have run into the hundreds of millions of euros, but the head of the 7th Customs Department which unveiled the fraud, Efthymis Katsas, is said to have come under strong pressure not to go deeper into the case.
Most of the illegal trade in fuels is in the form of the sale of heating fuel as automotive diesel, which is subject to a much higher tax. The two types of diesel are colored differently and so the process necessarily involves the decoloration of heating fuel by the fraudsters.
The government intends to equalize the taxes on the two types of fuel as of this Friday, in an attempt to pull the rug out from under the fraudsters’ feet. Distributors will sell automotive fuel without the tax and will be reimbursed for it later.
The investigators discovered a high sulfur content in automotive diesel, which suggested a decoloration process, and believe that the one of the rackets has its origins at a refinery. But they found it difficult to estimate the quantities produced, as the line of fraud starts from the fuel tanks where records of the quantities stored are unreliable. The probe found that meters on fuel spigots were also unreliable. Finally, cases of bogus exports of petroleum products were found to countries such as Saudi Arabia and Nigeria.
The investigators further established a host of tax violations and a network of illegal storage facilities and decoloration workshops.
A large number of distributors were found to be doing business at night, without proper licenses. The real vocations of many of those encounters had no relation to the petroleum products sector and included public servants, self-employed professionals and even members of the security forces. Given that the number of licensed distributors is about 2,300 for the entire country, it was difficult to locate the illegal operators.
It also emerged that no middlemen were involved in the process, suggesting that the illegal supplies were obtained directly from a refinery.
The investigation revealed illegal gas stations operating in many areas around the country, but with the proper tax registration numbers. Their large number, about 7,650, also made it difficult to pinpoint them.
Checks in illegal fuel trading are expected to intensify after Friday, when the tax equalization comes into force. They will be carried out mainly on distribution vehicles circulating at ports and on highways.
The sources said Deputy Finance Minister Antonis Bezas is also preparing to announce measures against the illegal trade in bunker fuels.