The Institute of Chartered Accountants in England & Wales has welcomed a Government clamp down on VAT fraud.
The Government is to seek permission from the EU to amend the VAT rules to help stamp out Missing
Trader Intra-Community dodges that have been costing the UK Exchequer billions of pounds.
Fraudsters are exploiting the rules that allow them to buy goods from other EU countries without having to pay VAT.
They then sell the goods correctly charging UK VAT but rather than paying over the collected amount to HM Revenue & Customs, they are pocketing it themselves and disappearing.
The goods involved are usually items such as computer chips and mobile telephones which are sold through a chain of companies in order to hide the fraud, often using unwitting third parties.
The Government says VAT should not be charged on sales to another VAT registered person, thus removing the opportunity to pocket the tax.
Francesca Lagerberg, chairman of the ICAEW Tax Faculty, said: "As professionals, we are completely against all fraud and have been very concerned about this particularly pernicious exploitation of the UK VAT system.
"We believe that the proposals from the Government are a welcome development and is something that we have been advocating as it should go a long way to tackling this practice. We are more than happy to lend our wholehearted support to the Government's request for the derogation and urge the European Union to approve these proposals."