Brewers head off more Government red tape over ‘beer tax avoidance’
By: JimOldfield
June 5th, 2012
The British Beer & Pub Association has issued a 10-point plan to tackle beer duty fraud – to try to head off the Government which is threatening yet more red tape for the brewing industry.
The All Party Parliamentary Beer Group is embroiled in conducting an inquiry into the issue – with the threat of costly “tax stamps” or “fiscal marks” as a requirement on every can and bottle of beer.
HM Revenue and Customs is insisting that duty fraud is a major issue.
But the BBPA does not believe the problem is anywhere near the scale suggested by HMRC and it has slammed the tax stamp threat as “a totally disproportionate response that ultimately would not stop fraud”.
In an attempt to head off yet more regulation the BBPA has produced the following 10 proposals:
- BBPA to collate duty-in-suspense sales from brewers by trade channel to assist in (a) monitoring the volume and trends in this market and (b) produce a robust upper and lower bound estimate of beer fraud.
- Individual brewers to continue to supply HMRC with a regular detailed breakdown of sales to customers in duty-to-suspense to both UK and EU, including volumes.
- Brewers to continue to review due diligence processes and implement rigorous know-your-customer programmes. BBPA to develop minimum recommended requirements consummate with size and risk.
- Brewers to provide timely information and intelligence on suspicious trading patterns and from due diligence actions.
- Brewers to investigate cost-effective technologies and how voluntary UK-specific labelling could enhance tracking capabilities and respond in a timely manner to track-and-trace requests from HMRC.
- HMRC to provide a dedicated point of contact for brewers to feed-in intelligence on suspected fraudsters.
- HMRC to seek similar commitments on traceability, provision of customer information, intelligence sharing and due-diligence programmes from wholesalers and other beer and wine supply chain agents.
- HMRC to pursue enhancements to EMCS (Excise Management & Control System, an EU-wide system where any movements of duty-suspended beer are recorded on a central database) to help assist in identifying fraud and fraudsters. BBPA says: “EMCS currently provides almost no intelligence to HMRC as it can only look at single movements. This should be an essential anti-fraud tool in looking at unusual patterns/trends, journey times, etc. Currently there is no requirement to include the owner of goods being moved which would seem a crucial piece of information”.
- HMRC and UKBA to actively pursue ways of improving the monitoring and tracking of consignments of alcohol entering UK ports and act accordingly to start re-balancing the risk and reward away from those involved in alcohol smuggling. BBPA says: “This should include pre-notification and recording of Administrative Reference Codes (ARCs), investigating separate lanes at ports, technologies for bulk scanning, regular and higher profile searches, visual warnings and publicity of tough actions taken against smugglers”.
- A joint anti-fraud task force is set-up to monitor and evaluate progress against actions, share insights and consider any additional proposals.
The BBPA – whose members account for 96 per cent of the beer produced in the UK – also supports a proposal put forward by the Federation of Wholesale Distributors, for a registration scheme for alcohol wholesalers. They are currently not required to have a licence to sell alcohol.
BBPA Chief Executive Brigid Simmonds said: “These commonsense proposals are the right way forward. They reflect the fact that HMRC already has the powers to tackle fraud, and we can get results by working more closely together.
“The current strategy is still to be fully implemented and we certainly don’t need costly new legislation or beer stamps, which would be a huge new burden on our industry at a time when the Government says it wants to cut red tape.”
Hand-Pumped links:
The link to the BBPA certificate can be found here:
Ilkley Brewery: www.ilkleybrewery.co.uk
