§ Mr. Alan ReidTo ask the Chancellor of the Exchequer what the(a) lower and (b) upper limits are of his estimate of the annual amount of spirits duty fraud; and how he arrived at these estimates. [165232]
§ John HealeyCustoms' estimate of spirits revenue evaded in 2001–02 is £600 million, as reported in "Measuring and Tackling indirect Fraud Losses 2003" (December 2003). The National Audit Office report "Estimating the Level of Spirits Fraud" (March 2004) calculates a corresponding 95 per cent. confidence interval of between £330 million and £1,080 million. This calculation takes account both of sampling variation in the initial level of consumption and of the under-reporting variation. Both reports are available in the Library of the House.
1696W
§ Lady HermonTo ask the Chancellor of the Exchequer whether it is his policy that the obligation to stamp spirit bottles announced in the Budget should extend to spirits produced in Northern Ireland. [164572]
§ John Healey[holding answer 31 March 2004]: The requirement for qualifying UK retail containers to bear a tax stamp will Apply to all home-produced and imported products.
§ Mr. Alan ReidTo ask the Chancellor of the Exchequer what estimate he has made of the change in(a) sales of spirits in the UK and (b) the consequent amount of duty collected that would be caused by increases in the sale price of a 70cl bottle in steps of one penny, up to 40 pence. [164498]
§ John Healey[holding answer 30 March 2004]: The sale price of a bottle of spirits is a commercial decision for individual retailers. HM Customs and Excise estimates that a 10p increase in the sale price of a bottle of spirits would lead to a reduction in sales of UK-dutied spirits of around 0.8 per cent. The effects of smaller or larger increases would he broadly pro rata. The impact on spirits duty revenues would depend on the extent to which such an increase was related to spirits duty increases or other factors.
§ Mr. Alan ReidTo ask the Chancellor of the Exchequer (1) what assessment he has made of the cost to the spirits industry of complying with his proposed tax stamps scheme; and which compliance costs he has so far not assessed; [164569]
(2) what assessment he has made of the cost to the spirits industry of keeping tax stamps secure. [164570]
§ John Healey[holding answer 30 March 2004]: The Government announced in the Budget that, owing to continued high levels of spirits duty fraud, it will legislate to implement the Roques Report recommendation to introduce tax stamps for spirits. In doing so, the Government will help the trade financially with compliance costs by deferring payment for tax stamps, assisting firms with capital investment and freezing spirits duty for the remainder of this Parliament. The Government are also investigating the potential for offsetting security costs. Further announcements will be made once all the detailed offsetting options have been considered in discussion with the trade.
A Regulatory Impact Assessment, to be published alongside the Finance Bill on 8 April, will identify in detail the impacts, costs and benefits of the tax stamp regime.
§ Mr. Alan ReidTo ask the Chancellor of the Exchequer what discussions he has held with the First Minister of Scotland with regard to the introduction of tax stamps on bottles of spirits. [164565]
§ John HealeyI refer the hon. gentleman to the answer I gave to the hon. Member for Perth, Annabelle Ewing the hon. Member for Perth earlier today.