HC Deb 30 March 2004 vol 419 cc1354-6W
Mr. Alan Reid

To ask the Chancellor of the Exchequer what assessment he has made of the tax stamps schemes for bottles of spirits(a) run by the United States Administration prior to 1985 and (b) proposed by the Norwegian Government in 1997. [164497]

John Healey

Tax stamps have been introduced in forty different countries for a variety of reasons ranging from quality assurance to tackling fraud. The wide range of different schemes and reasons for their introduction or withdrawal means that comparisons between countries cannot easily be drawn.

The USA withdrew its federal tax stamps in 1985 when a 1954 law governing marks on spirits was repealed. However, some States within the USA continued to use tax stamps for a number of reasons including the collection of state duties.

Norway passed enabling legislation for tax stamps in 1997 but has not yet introduced stamps, so it is difficult to make any meaningful assessment of its proposed scheme.

We have received information from over 20 countries about the operation of their tax stamps schemes. Of eight European Union and accession countries where direct inquiries have been made, Denmark, Italy, Portugal, Spain, Poland and the Czech Republic have no plans to withdraw their schemes. Poland in particular emphasised the anti-fraud benefits of their scheme.

Mr. David Stewart

To ask the Chancellor of the Exchequer (1) if he will estimate the impact of the introduction of strip stamps upon the competitiveness of UK distillers, with particular reference to the Scotch whisky sector; [161642]

(2) what estimate he has made of the effect on the cost of packaging for UK distillers of the introduction of strip stamps; and what estimate he has made of a consequent impact upon consumer prices; [161643]

(3) what estimate he has made of the impact of the introduction of strip stamps upon the efficiency of the UK distilling sector, with particular reference to Scotch whisky distillers; [161644]

(4) how many strip stamps he estimates UK distillers will need to purchase each year; and if he will estimate the impact of this cost upon (a) employment and (b) profitability in the UK; [161645]

(5) how many jobs he expects to be (a) eliminated and (b) created by the introduction of strip stamps; and what estimate he has made of possible impact upon consumer prices. [161646]

John Healey

The Government announced in the Budget that, owing to continued high levels of spirits duty fraud, it would legislate to implement the Rogues 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. Further announcements will be made once detailed options have been considered in discussion with the trade.

A regulatory impact assessment, to be published alongside the Finance Bill, will set out the anticipated impacts, costs and benefits of the tax stamp regime. The impacts on compliance costs, competitiveness, employment and consumer prices will all depend on the detailed measures taken to implement tax stamps, on the measures the Government will introduce to offset the impact on legitimate business and on business decisions taken by companies involved in the spirits production and supply industry.

Miss McIntosh

To ask the Chancellor of the Exchequer (1) what discussions have taken place with the spirits industry about introducing tax stamps; and when he expects to publish full details and costs of the proposals for tax stamps; [164824]

(2) what the reasons are for the delay in publishing details and costs of the proposed tax stamps since his original proposal. [164825]

John Healey

There has been extensive consultation with the spirits industry since December 2001 when a formal consultation on tax stamps issues was launched. Following the Chancellor's announcement in last year's Pre-Budget Report (Cm 6042) that he would implement at the Budget the Rogues report recommendation of tax stamps for products subject to the spirits rate of duty when an equally effective alternative could be found, Ministers and officials have received a wide range of representations and held more than 40 meetings with industry representatives. These discussions are continuing and joint industry Government working groups have been established to progress the implementation of tax stamps.

It is the Government's intention to publish a full Regulatory Impact Assessment alongside this year's Finance Bill on 8 April.