For most in freight and logistics, the key issue in the Budget is whether the duty of fuel is going to rise – and of course we now know that it didn’t.
But, much less publicity has been given to another measure – a proposal to combat VAT fraud in online retail (specifically by non-EU traders) which the government reckons is costing up to £1.5 billion a year.
And this promises to have a big impact on fulfilment houses, freight forwarders and express and logistics operators.
The HMRC’s consultation paper, “Fulfilment House Due Diligence Scheme” highlights a growth in attempts to evade VAT and customs duty through abuse of reliefs to facilitate trade, and by misdeclaring and undervaluing goods imported from outside the EU by some non-EU overseas suppliers.
The government wants to introduce a due diligence scheme for UK-based fulfilment houses in 2018. The aim is to make it more difficult for non-compliant suppliers to trade in the UK and enable HMRC to tackle them more easily.
Freight and customs agents, fast parcel operators, express industry and other businesses will have to check if fulfilment houses they are dealing with are registered or not.
Clearly this could have a significant impact on operations so it is well worth looking over the consultation paper. You can find it here.