§ Mr. LuffTo ask the Chancellor of the Exchequer, pursuant to his answer of 1 July,Official Report, column 105, if the latest estimated figures of duty revenues lost as a result of cross-border shopping include VAT. [9942]
§ Dawn PrimaroloFigures given in the answer of 1 July were for excise duty only and did not include any amounts for VAT.
Customs' estimate of excise duty and VAT revenues lost from legitimate cross-border shopping for alcohol and tobacco products for the year ending 30 June 1996 is given in the table. 14W
Revenue losses from cross-border shopping (£ million) Product type Excise duty VAT Total revenue Beer 25 15 40 Wine 75 35 105 Spirits 45 15 60 Tobacco products 55 15 70 Total 200 75 275 Figures have been independently rounded to £5 million. Figures in this answer assume that 50 per cent. of alcohol purchased is additional consumption; this assumption is currently under review.
Customs' estimate of total revenue evasion—excise duty and VAT—through smuggling of alcohol and tobacco products, excluding any losses from commercial fraud, is set out in the table. The actual loss to the Exchequer will be less than the amount of revenue evaded, as some smuggling is likely to represent additional consumption rather than substituting for similar goods bought in the UK.
Revenue evaded through smuggling (£ million) Product type Excise duty VAT Total revenue Beer 75 35 110 Wine 35 15 50 Spirits 40 10 50 Hand-rolling tobacco 335 85 425 Cigarettes and other tobacco products 110 25 135 Total 590 175 770 Figures have been independently rounded to £5 million. Components may not therefore sum to the totals given.