Following consultation between February and May 2017 on a group of new sanctions against evasion of tobacco duty and other excise duties, HMRC will carry out further work on a group of proposed sanctions for evasion of tobacco duty, with a view to confirming early next year how it intends to proceed. The main conclusions were:
100% penalty multiplier for lost revenue from repeat offences: a majority of respondents believed that an increase in the level of financial penalties would deter repeat offending, so further work will now be taken forward on these proposals;
new civil penalty for dealing in illicit tobacco: most respondents were in favour of introducing a new civil penalty and further work will be done with other enforcement agencies on design and administration of such a penalty;
reducing the threshold for publishing details of deliberate defaulters to £15,000 in overall lost revenue where the excise wrongdoing was deliberate: responses to this proposal were very mixed and further work will be done, including consideration as to whether the existing sanction of publication of details is an effective and suitable deterrent; and
imposing a statutory duty of care on landlords of retail properties where tobacco offences are committed: the majority of respondents were not in favour of this approach and HMRC will discuss it further with landlord and landowner representative bodies.
The government has decided not to introduce further controls on importers or exporters of tobacco products and will not, at this stage, seek to introduce a supply-chain licensing scheme aimed at tackling the illicit trade, following a separate consultation held early in 2016.
Legislation in the second Finance Bill 2017 will introduce mandatory licensing of tobacco manufacturing machinery in the UK from August 2018. HMRC is consulting until 5 December on the draft Tobacco Products Manufacturing Machinery (Licensing Scheme) Regulations 2017. Registration for the scheme is expected to begin in April 2018, with full implementation and enforcement powers coming into effect on 1 August 2018. See http://bit.ly/2AfSAiK.
Following consultation between February and May 2017 on a group of new sanctions against evasion of tobacco duty and other excise duties, HMRC will carry out further work on a group of proposed sanctions for evasion of tobacco duty, with a view to confirming early next year how it intends to proceed. The main conclusions were:
100% penalty multiplier for lost revenue from repeat offences: a majority of respondents believed that an increase in the level of financial penalties would deter repeat offending, so further work will now be taken forward on these proposals;
new civil penalty for dealing in illicit tobacco: most respondents were in favour of introducing a new civil penalty and further work will be done with other enforcement agencies on design and administration of such a penalty;
reducing the threshold for publishing details of deliberate defaulters to £15,000 in overall lost revenue where the excise wrongdoing was deliberate: responses to this proposal were very mixed and further work will be done, including consideration as to whether the existing sanction of publication of details is an effective and suitable deterrent; and
imposing a statutory duty of care on landlords of retail properties where tobacco offences are committed: the majority of respondents were not in favour of this approach and HMRC will discuss it further with landlord and landowner representative bodies.
The government has decided not to introduce further controls on importers or exporters of tobacco products and will not, at this stage, seek to introduce a supply-chain licensing scheme aimed at tackling the illicit trade, following a separate consultation held early in 2016.
Legislation in the second Finance Bill 2017 will introduce mandatory licensing of tobacco manufacturing machinery in the UK from August 2018. HMRC is consulting until 5 December on the draft Tobacco Products Manufacturing Machinery (Licensing Scheme) Regulations 2017. Registration for the scheme is expected to begin in April 2018, with full implementation and enforcement powers coming into effect on 1 August 2018. See http://bit.ly/2AfSAiK.
