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Fraud

Answer

Drawback allows businesses to claim a repayment of excise duty on ““duty paid”” alcohol that they dispatch directly to another member state, export outside the EU, or destroy. HMRC is aware of arrangements in other member states that allow UK drawback claimants to place UK duty paid goods in tax warehouses in those member states. In order to gain a better understanding of the nature of this trade and any possible associated fraud, HMRC is working with UK representatives and counterpart tax authorities in those member states. Claims to drawback in the UK are now assured by a central team, enabling better targeting of high-risk claims. A pilot exercise is under way to gain a better understanding of the reasons for the recent increase in the level of drawback claims and to determine a robust operational response. Previous examination of claims indicates, that a large proportion relates to UK-produced beer. No estimate has been made of the revenue lost to HMRC from drawback fraud across all excise goods. HMRC keeps neither central records of the numbers of officers deployed on drawback-related cases, nor statistics on the number of drawback investigations, prosecutions and convictions. Obtaining this information would incur a disproportionate cost. From 1 April 2010, HMRC will introduce a new standard penalty system for a number of excise regimes, including drawback. From this date, anyone making a false claim will be liable to a penalty based on, among other factors, the potential lost revenue.

Secondary information

Type

Written question

Reference

6086; 714 c165-6WA

Session

2008-09

Subjects

Fraud Enforcement Excise duties Powers

Link

View this Written question on www.publications.parliament.uk