(2) what steps (a) his Department and (b) HM Revenue and Customs is taking in co-operation with European counterparts to reduce levels of alcohol duty fraud;
(3) how many allegations have been received by HM Revenue and Customs (HMRC) in the last 12 months of the sale of alcohol on which duty has not been paid; and how many such allegations have been investigated by HMRC.
The Chancellor announced at Budget 2009 the revised ‘tackling alcohol fraud’ strategy which has three principal themes:
Strengthening our operational responses;
Reducing opportunities for fraud;
Closing off illicit supply chains.
The strategy is set out in further detail in “Renewal of the Tackling Alcohol Fraud strategy”, published in April 2009 and available at
HM Revenue and Customs (HMRC) is making good progress on all three strands of this strategy. The regulatory framework is being strengthened to reduce opportunities for fraud; the new operational model for HIV1RC to respond to fraud using new approaches and the full range of HMRC’s powers is on track to be implemented from April 2010; and HMRC is working with the large brewers and wholesale buying groups on developing practical measures to close off illicit supply chains.
HMRC co-operates with its European counterparts on excise matters, including alcohol fraud, under the terms of EC Council Regulation 2073/2004 (on the administrative co-operation in excise matters) and the Naples II Convention. Additionally, over the past eight years the UK has worked with counterpart revenue authorities on the development of the EU-wide Excise Movement and Control System (EMCS). This provides an electronic system for monitoring the movement of excise goods in duty suspension within the EU and comes into effect on 1 April 2010.
In the period from 1 January to 31 December 2009 HMRC received approximately 650 allegations relating to alcohol. All allegations are actioned. A range of responses, including formal investigations, are considered as appropriate depending on the seriousness of the allegation and quality of intelligence provided. For operational reasons and to protect third party confidentiality HMRC cannot comment on how many allegations have been formally investigated.