The United Kingdom Warehousing Association has voiced concern that HMRC is imposing such severe sanctions on companies in the excise goods supply chain, that they will drive long established and honest firms out of business.
It argues that if logistics service businesses were to make any technical error relating to duty-suspended excise goods, they risk incurring “crippling” duty assessments and fines.
“Any company that accidentally ‘ticks the wrong box’ while goods are under duty suspense – whether in production, holding or movement –will create a ‘duty point’,” said Alan Powell, UKWA’s advisor on excise matters.
“If the company doesn’t pay the duty at that time, a liability of up to 100 per cent of the duty will be incurred for ‘holding’ duty-unpaid goods.
“Furthermore, everyone in the supply chain that handles the goods on which the duty hasn’t been paid is similarly liable to the penalty. Given that excise duty is so high, the risk of such liability can be damaging at best and catastrophic in the worst case,” he added.
UKWA believes that all assessments and penalties put in place as a result of genuine error render the law unfit for purpose.
It is currently reviewing the proportionality of the penalty regime, having not only discussed with industry, but taken legal advice from senior counsel.
Roger Williams, UKWA’s chief executive officer, said: “The current rules evidently do not deter fraudsters but put legitimate business at great risk. We will fight this all the way for our members.”