The Association of Convenience Stores (ACS) has renewed its calls for targeted action at a local level, to reduce the impact of the illicit trade on responsible retailers.
Its call followed publication of HM Revenue and Customs’ report on the prevalence of non-duty paid alcohol and illicit tobacco in the UK, estimating the value at more than £3bn.
According to HMRC, the tobacco tax gap driven by the illicit market in cigarettes and hand-rolling tobacco is estimated to be £2.5bn in 2016-17. Of this, £1.9bn was lost in tobacco duties and a further £0.5bn in VAT.
The alcohol tax gap (including beer, wine and spirits) is estimated to be £1.3bn, of which £0.9bn was in alcohol duties and a further £0.4bn in VAT. There is no change on the previous year’s figures, which also estimated a total alcohol tax gap of £1.3bn.
ACS chief executive James Lowman said: “The illicit trade in tobacco harms legitimate retailers trading in communities across the UK. We believe that local enforcement authorities should be given more powers to deal with those who supply and sell illicit goods, including the power to remove alcohol licences from offenders.”
The Government is currently considering the implementation of track and trace regulations, which will put in place a new method of tracking the sale of legitimate tobacco products through the supply chain. The intention is to significantly reduce the illicit tobacco trade.
ACS has called on the Government for clarity on the timeframes for the regulations to give retailers enough time to prepare.
Lowman added: “Measures like the track and trace regulations which aim to reduce the tax gap are welcome, but there are still unanswered questions when it comes to the operation of these regulations. We are working with HMRC to clarify the timescales for applying for Economic Operator Identifier Codes and preparing for the day to day operations under the new regulations.”
Retailers looking to report those selling illicit goods should call the HMRC fraud hotline on 0800 788887.