Clause 26 - Penalty for contravention of relevant rule
Finance Bill
10:45 am
Mr John Healey (Economic Secretary, HM Treasury; Wentworth, Labour)
Civil penalties are being introduced to encourage businesses to comply with their legal obligations. Where businesses are suspected of evading duties, the law will provide Customs and Excise with an alternative to prosecution—the imposition of a civil evasion penalty.
There will be two types of penalty. The evasion penalty established in clause 25, with which we have just dealt, will be used as an alternative to prosecution in less serious cases of evasion. It is not a substitute for prosecution, and businesses or individuals that evade or try to evade duties or taxes will continue to be penalised either through a civil evasion penalty or, where appropriate, criminal prosecution.
The other penalty, which is set out in clause 26, will deal with general non-compliance where evasion is not involved. It will be used in cases of failure to comply with legal requirements and obligations—for example, a business that makes persistent errors on import declarations. It will also be used to deal with the small number of businesses that fail to comply fully with legal requirements and obligations in seeking to gain a competitive advantage over other businesses; and to encourage those businesses that persistently make mistakes to improve their performance. It will not be used to punish occasional, minor errors.
The maximum penalty for a contravention not involving evasion through dishonesty will be £2,500.