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Customs And Excise

Volume 403: debated on Monday 7 April 2003

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To ask the Chancellor of the Exchequer (1) if he will meet the wine, spirit and beer sector to discuss the future application of HM Customs and Excise throughput rules for bonded warehouses; [106043](2) what assessment he has made of the impact the bonded warehouse throughput rules will have on small and specialist wine distributors across the UK; [106039](3) if he will require HM Customs and Excise to incorporate risk analysis and discretionary assessments into the decision-making process authorising bonded warehouses; [106041](4) what effect the new guidelines for HM Customs and Excise rules on throughput criteria for bonded warehouses will have on the licensed trades industry; [106038](5) if he will have discussions with the Chief Executive of Customs and Excise concerning the impact of bonded warehouse throughput rules on small and specialist wine distributors across the UK; [106040](6) what representations he has received from wine and beer suppliers regarding Customs and Excise application of bonded warehouse throughput rules; [106044]

(7) how many compliant businesses will be affected by HM Customs and Excise requirement to uncouple physically a shop selling duty paid goods from a bond maturing wines held in duty suspense. [106042]

In line with its wider approach to keeping burdens on business to a minimum, the Government seek to ensure that regulatory requirements on the alcohol trade are fair and proportionate, offering as much flexibility to businesses as possible while preventing unacceptable revenue losses.The law endows Customs and Excise with the ability to exercise discretion over approvals of excise warehouses, and requires them to deploy that discretion in a fair, equitable and reasonable way. Customs have a responsibility to businesses to ensure consistency of treatment. To this end, they have developed and published a policy on the types of premises to which they would normally grant approval. One of the conditions for approval under this policy is that businesses must meet laid-down minimum throughput criteria, which have been in place since 1980, and which were converted into the current monetary criteria in 1996. There are, therefore, no new guidelines on throughput criteria for excise warehouses.These criteria help ensure that a fair balance is struck between facilitating the trade in allowing traders to store goods in duty suspense, and minimising the cost to the Exchequer of allowing duty to be deferred after production or importation of excise goods, and the cost of controlling these premises. Without throughput criteria, any off-licence, tobacconist or supermarket would be eligible for excise warehouse approval and would be able to store its stock without payment of duty up until the time it was removed to its shop shelves. This would increase costs for Customs in assuring and collecting the duty from such a large number of warehouses, would delay the duty point with a consequent effect on revenue cash-flow, and would potentially provide unacceptably widespread opportunities for alcohol fraud.To support this approach, a further condition was introduced which established that premises used for a retail business could not also be an excise warehouse. Details of this were published in the January 1996 edition of Customs' public notice on warehousing and duty suspension.As the Minister responsible for Customs and Excise, I have regular meetings with their Chairman and other Senior Managers. Ministers and officials meet representatives of the alcoholic drinks industries on a regular basis to discuss a wide range of issues affecting the sector, including their Budget representations. I have also recently received one letter containing representations about the effect of the throughput criteria on one wine trader.