HM Revenue and Customs’ excise policy towards the oil industry has been slammed in a speech at an event at the House of Lords.

The event was organised by materials handling specialist Jungheinrich UK, and the United Kingdom Warehousing Association (UKWA).

During a welcoming address to representatives from over 50 UKWA member companies, as well as several Lords and MPs, UKWA chief executive officer Roger Williams drew attention to an excise issue affecting downstream oil supply in the UK that UKWA is currently addressing on behalf of its members.

He said: “At present, HMRC prohibits the movement of refined oil from the refinery tax warehouse to another UK tax warehouse under duty suspension arrangements. This means that oil refined in the UK cannot be moved from one bonded site to another - product has to be moved on a duty-paid basis. At the same time, oil can be moved duty suspended from EU tax warehouses, such as Rotterdam, to the key UK storage sites on the Thames Estuary.

"If this sounds like insanity, it is and neither HMRC nor The Treasury has been prepared to budge. There is hope, however, because we know that the prohibition of the duty suspended movement of oil within the UK is only a policy operated by HMRC. It is not law and precisely because the policy is insane, it is unreasonable in UK public law and can - we say must - be changed by a quick amendment to HMRC’s Oils Public Notice which contains the offending policy.

"So to correct the law on excise and make the downstream supply chain fit for purpose - and it is an utter shambles throughout in terms of excise law and policy - we will be engaging and actually leading this battle, starting with a complaint to the EU Commission that the UK policy infringes EU law and that if it is not corrected, the Commission should commence infraction proceedings against the UK. On the domestic front, we will be engaging with appropriate ministers, the Treasury and HMRC.”