Beer tax fraud inquiry: Government should freeze beer duty

That’s the comment from Kate Nicholls, strategic affairs director at the Association for Licensed Multiple Retailers, who was giving evidence at the All-Party Parliamentary Beer Group inquiry into beer tax fraud.

Nicholls said: “When the last Government introduced spirits tax stamps in 2005/2006, they acknowledged the costs this would cause to the valuable exports industry and pledged to freeze spirits duty in order to compensate for those costs.

“We’ve not had a similar pledge about the costs that are going to come down the beer supply chain and to community pubs.”

She also touched on the penalties of getting confused over which beers should be stamped. The consultation proposes that licensees will face criminal prosecution.

Nicholls suggested that HM Revenue & Customs (HMRC) should issue a list of the products that should and should not have a stamp.

She said: “It’s the fact that you’ve got confusion because you’ve got exceptions  — not just because it might be a small producer, but there is talk in the consultation about only applying it to the most popular brands that have the biggest market share and feature heavily in the market.

“The barstaff [would] not only have to know the ones that are below 200,000HL, but they [would] also have to have a view on whether those beers are high market share.

“It seems easier to us if HMRC put out a list of those products that they think should carry a tax stamp — then every pub in the land could just have a check.”

British Beer & Pub Association chief executive Brigid Simmonds also highlighted issues of competition law.

She said: “We have approached the European Commission about this… the Commission makes clear that the 200,000HL limit was set for a specific purpose, which is to do with taxation, and, therefore, it wasn’t at all convinced that the specific purpose would be used for something else, which is not about taxation, but is about duty fraud.

“[This issue] would require more discussions.”