MPs call for tighter controls to tackle £500m beer smuggling tax fraud
Beer smuggling is costing the UK up to £500m in tax fraud each year and tighter controls must be put in place, MPs have warned.
The All-Party Parliamentary Beer Group conducted a two-month inquiry into beer tax fraud and found that the trade in illicit beer had a "corrosive impact" on the industry.
Co-chair of the inquiry Andrew Griffiths MP said: "Smuggling beer into the UK from France has become a highly profitable business. As our duty differentials have increased, so, it appears, has the scale of the trade in illicit beer.
"We're not talking about chancers on day trips in white vans, so much as organised criminal gangs shipping lorry loads of beer through Dover every night, and netting £18,000 in duty alone each time. It's hurting legitimate businesses, as it's undercutting them on its way into the supply chain, and once it has permeated the UK market some retailers are stocking it unwittingly, and risking their licences and livelihoods in the process."
The inquiry found unanimous support for proposals to close a loophole in the supply chain in alcohol by introducing compulsory registration of wholesalers, and considerable scope for improved voluntary measures. It also found that existing enforcement was not as effective as it could be, that not all anti-fraud measures were being used to their full effect, and that better co-operation between HMRC and other authorities, and trade associations, could disrupt fraud significantly.
However, Griffiths added that duty stamps were not the way forward. "We came to the conclusion that introducing duty stamps would limit choice, add complexity and confusion, and possibly face a challenge in the European Union," he said.
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By Kerstin Kühn
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