To be honest VAT has always been a disaster waiting to happen, and inside the European Union it is an unmitigated nuisance to enforce.
VAT, you see, isn't a sales tax. When one company sells stuff to another one, it charges VAT on the deal which the other company can then claim back. In a chain of businesses, this carries on until the end user gets stung with the final VAT charge. This therefore lends its self to a criminal activity called Carousel Fraud, whereby VAT-liable goods are moved around, with VAT being fraudulently claimed back repeatedly. Carbon credits are the current favourite target here, since they are intangible and thus shipping costs are minimal.
Carousel fraud costs the EU thousands of millions of Euros per annum in lost revenue, and probably the same again in administration costs. As taxes go, it is a fraudster's wet-dream and a tax enforcer's nightmare and yet, as with much of the EU, it is a bad idea that is effectively here to stay.
Simply ignoring VAT, as is going on here, is another downside to it; it is simply near-impossible to catch all the fraudsters doing this, since almost no customers will trouble to report people for giving them a good cheap deal.