A retail trade body has spoken of dismay that the Government has – so the Association of Convenience Stores (ACS) claims – failed to follow through on measures to tackle the pervasive trade in non-UK duty paid alcohol.
ACS Chief Executive James Lowman said: “Alcohol fraud is having a devastating effect on local shops. For too long criminals have been able to exploit a flawed system to sell non-UK duty paid product to retailers and consumers, the Treasury’s own estimate is that in beer alone this equates to a duty loss of £800m.
“Ministers’ decision to abandon plans to impose a duty stamp on beer is a major step backwards that allows the black market to flourish at the expense of honest legitimate retailers and tax payers. We are also concerned about the weak decision to ‘consult further’ on proposals for a register of wholesalers. While ministers dither these well organised criminal networks can carry on with impunity. ACS has made the case for duty stamps and a register of wholesalers in meetings with ministers and in Parliament, and we will continue to campaign for action.”
Economic Secretary to the Treasury Sajid Javid admitted that alcohol fraud is a serious problem which HMRC estimates leads to revenue losses of about £1.2 billion a year. It also has a detrimental impact on the legitimate businesses. Hence the Government consulted last year on potential measures, whether beer fiscal marks, supply chain legislation or a registration scheme for alcohol wholesalers. As Sajid Javid put it, proposed measures might have an impact on legitimate alcohol supply chains.
The Government has decided not to proceed with beer fiscal marks or supply-chain legislation at this time. “Compelling evidence was provided on beer fiscal marks to show that, although it could be a useful tool to counter trade in illicit products, the costs of affixing stamps to goods could be significant for the UK brewing industry and particularly for legitimate importers and exporters.”
As for the supply-chain, the consultation raised the practicality and cost of introducing new ‘track and trace’ across the brewing industry, and the likely effectiveness. Hence the Government is not legislating for secure alcohol supply chains. The Government will consult shortly on new proposals for due diligence obligations of excise businesses throughout the supply chain.
The Government promises only ‘steps to increase collaboration with industry and between enforcement agencies; measures aimed at tightening controls in the existing excise regulatory system; dealing more robustly with those found holding or moving illicit goods, and increasing co-operation with other EU member states’.
A copy of the full response to the consultation on the GOV.UK site at https://www.gov.uk/government/publications?publication_filter_option=consultations.
