HC Deb 31 October 1996 vol 284 cc767-8
1. Mr. Gordon Prentice

To ask the Chancellor of the Exchequer what measures he is taking to curb smuggling in tobacco and alcoholic drink. [308]

The Exchequer Secretary to the Treasury (Mr. Phillip Oppenheim)

Customs and Excise has almost 300 staff employed directly to prevent the cross-border smuggling of excise goods. They include a further 25 posts recently allocated to Dover. This front-line effort is backed up by specialist intelligence investigation teams whose efforts are being intensified. In addition, new computerised systems are being set up to enhance the co-ordination and analysis of intelligence about excise smuggling. Smugglers run the risk of losing the imported goods and the vehicles used to transport them. They also risk a prison sentence of up to seven years.

Mr. Prentice

I thank the Minister for that reply. However, that news is inadequate, given that £770 million is lost to the Exchequer every year through smuggled drink and tobacco and a further £300 million is lost through cross-channel booze expeditions. Those expeditions are having a huge effect on my constituency, where five pubs have closed in the past 12 months. Yesterday, the Chancellor said that he was in favour of some approximation of taxes that bear on sales, such as excise duty".—[Official Report, 30 October 1996; Vol. 284, c. 674.] When will there be some approximation of levels of duty across the European Union to damp down on smuggling?

Mr. Oppenheim

On the latter part of the hon. Gentleman's question, he will have to ask Chancellors in other EU countries. We have no control over their excise levels.

Having said that, I do not seek to minimise the problem. The hon. Gentleman has put his finger on an important difficulty, although, to put it in context, the loss represents some 5 per cent. of the £19 billion collected in excise duty. The fundamental problem is that collecting all the missing revenue would involve huge numbers of uniformed officers stopping every vehicle and person. That would result in massive queues at ports and airports, matched only by the queues of people complaining at every hon. Member's constituency surgery. Therefore, we are concentrating our intelligence resources on the large, organised smuggling gangs where the real criminal activity is taking place.

Mr. Carrington

Has my hon. Friend seen the report by Customs and Excise confirming that the figures relating to smuggling published by the tobacco and brewing industry were approximately accurate? Will he confirm that any hope of curbing smuggling can be effective only if the costs of beer and tobacco are approximately equal on either side of the channel? Does he agree that the solution lies with the French putting a sensible level of tax on tobacco to encourage their population to give up smoking?

Mr. Oppenheim

I have little influence on my opposite number in France. However, I understand that the French recently decided to increase tax on tobacco by 9 per cent. later this year.

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