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Tobacco Smuggling

Volume 621: debated on Thursday 8 February 2001

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3.21 p.m.

nder what authority HM Customs and Excise has started to seize small quantities of cigarettes from British travellers returning from abroad and on occasion to detain the travellers incommunicado.

My Lords, Statutory Instrument 1992/3155, the Excise Duties (Personal Relief) Order 1992, implementing EU Directive 92/12/ EC makes any excise goods personally imported from another member state liable to forfeiture if they are intended to be used for a commercial purpose. The Police and Criminal Evidence Act 1984 lays down strict conditions about how long persons can be detained after arrest. Unless persons commit an arrestable offence they are free to leave Customs controls at any time.

My Lords, I thank the Minister for his comprehensive reply. Of course Customs officers have a duty to try to stop evasion of tobacco duty. However, is it acceptable to seize cigarettes—the number being well below the legal limit of 800—from an individual on the grounds that his breath did not smell of tobacco and he was carrying neither matches nor a lighter in his pocket? Is it acceptable to keep a group of passengers waiting for six hours in midwinter, as I am assured occurred, without allowing them to ring their families to say that they were safe? Is it also acceptable to tell other people who had returned to their homes in the West Midlands and north of England after the cigarettes had been confiscated that they could have their cigarettes back after all provided that they presented themselves at Dover before ten in the morning?

Is it not time that the powers of Customs and Excise, which date from the autocratic 17th century—were scaled down and brought into line with the more modest powers enjoyed by the police, which date from the more enlightened 19th century?

My Lords, I have read the article in the Daily Telegraph to which the noble Lord refers implicitly. The responsibilities of Customs officers are to establish whether cigarettes are being imported for commercial use. In doing so, they have to take into account the commercial status of the person who bought the cigarettes, whether the cigarettes will be stored, for example, in a warehouse, whether the receipts and invoices show that they have been bought by a business and whether the cigarettes are of one brand or a mixture—in other words, whether they are intended to be smoked by one person. Under those circumstances, clearly there is an element of judgment for Customs officers to exercise.

These are openly called "smoking tours" and coaches can be stopped at Dover and Coquelles. Customs officers invite the passengers to alight from the coach, luggage is available on a carousel, and they carry out the proper inquiries as to whether those cigarettes are imported for personal use.

My Lords, while I welcome the action that the Minister is taking against small-scale tobacco smugglers, I would equally welcome the engagement of Customs and Excise in large-scale activity. Is my noble friend aware that the European Commission is pursuing a suit in the court in New York for £3 billion against Philip Morris and R J Reynolds; that the European Commission has invited every member state to join in that action; and that to date Italy, Spain and Germany have done so? Will the Minister encourage Customs and Excise also to join in that action so that the £3 billion which has been illegally extracted from the taxpayers of Europe can be recovered?

My Lords, I am aware of the case to which my noble friend refers. Customs and Excise is actively considering whether to join in the case. I am sure that Treasury officials will also wish to consider the matter.

My Lords, the problem is not that Customs officers are doing their job but that British tobacco manufacturers are exporting enormous quantities of cigarettes to countries where there is no market for them secure in the knowledge that illegal and criminal syndicates in those countries then return them to this country under the guise of smuggling. Is it not time that the details of the wholesaler and the countries of origin and destination are properly identified on these packets; and that the tobacco manufacturers in this country are made to accept responsibility for their part in this trade?

My Lords, we would be keen to encourage any degree of openness which would deter the organised gangs involved in these operations. My noble friend will be glad to know that in the past few weeks we have broken up no fewer than 38 organised criminal gangs who have been involved in these activities.

My Lords, is not the real problem that our European partners give the health of their citizens a lower priority than have successive British governments in relation to smoking?

Are there any powers which would enable us to go back to old procedures whereby one could purchase 200 cigarettes—"and that's your limit, mate"?

My Lords, no. A European directive has been accepted under unanimity provisions which changed what my noble friend calls "the old procedures". It would not be proper for me to comment on the motivations of governments of other member states.

My Lords, can my noble friend inform the House of the normal limit per person which our European masters allow our citizens to bring into the United Kingdom? At what threshold does the European law operate?

My Lords, I do not accept the description of "masters". There is no fixed threshold. However, where more than 800 cigarettes are imported, Customs officers tend to make the inquiries to which I referred earlier.

My Lords, is it also true to say that the current rates of tax on cigarettes encourage a trade which seems to account for an increasing proportion of cigarettes sold in this country? As a result of that trade, the government health warning on packets of cigarettes is reaching an increasingly smaller proportion of a market, the remainder of which is denied, therefore, that valuable health warning.

My Lords, I hope that the noble Viscount is not encouraging tax harmonisation within the European Union. If I thought that that were the case I might have to report him to the shadow Cabinet!

Yes, we have significantly higher duty than other European countries. It is incumbent on us, therefore, to do everything we can to stop illegal imports. Only last week, on the first use of the new scanner which can attack the really bulk trade in cigarettes—that is, container trade—we stopped a container in Felixstowe which contained 6 million cigarettes, saving the Revenue £1 million. One seizure was thus worth half the cost of the scanner.

My Lords, does the Minister accept that my original and supplementary Questions referred not to the treatment of the guilty, which concerned some of his noble friends, but to the treatment of the innocent?

My Lords, of course I accept that, but the trouble is that I know that the noble Lord was referring in particular to coach passengers, because that is what the Daily Telegraph article is about. Between 70 and 80 per cent of coach travellers who have goods seized are previous offenders. That is not the persecution of the innocent; it is dealing properly with what is undoubtedly an illegal trade.