HC Deb 06 December 1996 vol 286 cc830-1W
Mr. Foulkes

To ask the Chancellor of the Exchequer what estimates he has made of the annual amount lost to the Treasury through evasion of duty on(a) wines, (b) spirits, (c) beer, and (d) tobacco products by (i) falsification of export documents, (ii) illegal imports and (iii) other means; what plans he has to counter such evasion; and if he will make a statement. [6786]

Mr. Oppenheim

There is no official estimate of revenue lost due to the falsification of export documents for alcohol and tobacco.

Customs' current estimate of the total revenue evaded—excise duty and value added tax—annually through the smuggling of alcohol and tobacco is set out in the table. The estimate does not include any amounts for commercial fraud. The amount actually lost to the Exchequer will be less than the amount evaded, because many smuggled goods, particular alcoholic products, represent additional consumption rather than substituting for similar goods purchased in the UK.

Product type Revenue evaded (£ million)
Beer and Cider 110
Wine 50
Spirits 50
Tobacco Products 560
Total 770

The Chancellor announced in his Budget statement that the Government would be cracking down on the evasion of excise duty and VAT. To this end, a further allocation of some 190 staff will be made to customs for the financial year 1997–98 specifically to combat the smuggling of alcohol and tobacco, for the investigation of excise fraud and to improve compliance with excise regulations. This is in addition to the front-line, support and investigation staff currently deployed to combat this type of evasion.

Rev. Martin Smyth

To ask the Chancellor of the Exchequer what further steps he is taking to protect(a) tobacconists and (b) others from (i) cheap and (ii) illegal imports. [4307]

Mr. Oppenheim

[holding answer 26 November 1996]It is quite legal for travellers to other member states to purchase excise goods without the requirement to pay UK excise duty on their return home, providing the goods are for their own use. However, it is illegal for such goods to be imported for a commercial purpose without payment of UK duty.

Customs and Excise currently has over 250 excise verification officers employed directly to prevent single market smuggling of excise goods. The Chancellor announced in his Budget speech that a further 70 posts are to be added to this number. This front-line force is backed up by specialist intelligence and investigation teams, whose resources are also being increased under the Department's investigation and intelligence fundamental expenditure review.