Fuels: Tax Evasion

HM Treasury written question – answered on 5th February 2015.

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Photo of Lord Empey Lord Empey UUP

To ask Her Majesty’s Government how many persons have been prosecuted for illegal fuel smuggling in Northern Ireland in the last five years for which figures are available.

Photo of Lord Empey Lord Empey UUP

To ask Her Majesty’s Government what measures they are taking to prevent the distribution of laundered fuel in the United Kingdom.

Photo of Lord Empey Lord Empey UUP

To ask Her Majesty’s Government what is their estimate of the amount of revenue lost to the Exchequer as a result of illegal fuel laundering and distribution in Northern Ireland.

Photo of Lord Empey Lord Empey UUP

To ask Her Majesty’s Government what discussions they have had with the authorities in the Republic of Ireland concerning the processing and distribution of laundered fuel in Northern Ireland; and when the last discussions took place.

Photo of Lord Empey Lord Empey UUP

To ask Her Majesty’s Government whether HM Revenue and Customs officials have carried out any joint operations with their counterparts in the Republic of Ireland aimed at preventing the manufacture and distribution of illegally produced fuel in the border area; and what was the outcome of any such operations.

Photo of Lord Deighton Lord Deighton The Commercial Secretary to the Treasury

HM Revenue and Customs (HMRC) fights fuel fraud on a wide range of fronts, from special units performing thousands of roadside checks to dismantling laundering plants. Additionally the UK will shortly implement an improved new marker for rebated fuel, which will make it much harder for criminals to launder marked fuel and sell it at a profit. The impact of this activity is shown by the fact that 2.11m litres of illicit fuel were seized in the UK in 2013/14 (including 0.57m in Northern Ireland) and 44 laundering plants were dismantled in the same period (38 of these were in Northern Ireland).

HMRC arrests those involved in fuel fraud, but decisions over prosecutions are made by the judiciary. It is not possible to break down figures to determine prosecution specifically for fuel smuggling in Northern Ireland, but prosecutions for all forms of fuel fraud are as follows (figures are not available for years before 2011/2012):

2011/12

14

2012/13

7

2013/14

6

HMRC works closely with the Revenue Commissioners in the Republic of Ireland at a number of levels; this includes regular exchange of information, joint operational activity and the gathering of evidence for use in criminal prosecutions.

At a strategic level the development of the new fuel marker has been a joint initiative between HMRC and the Revenue Commissioners. The Revenue Commissioners are also partners in the Cross Border Fuel Group. This sub-group of the Organised Crime Task Force is chaired by HMRC and includes representatives from the Police Service of Northern Ireland, National Crime Agency, Environmental Agency, plus their equivalents from the Republic of Ireland. It last met on 23 October 2014. In addition to identifying emerging trends and areas of common interest, this Group also identifies opportunities to take multi-agency action against organised fuel crime.

No assessment has been made of the loss of revenue specifically due to fuel laundering. However, tax gap figures published by HMRC estimate the market share for all illicit diesel in Northern Ireland as 13%, or £80M in 2012/13. Petrol fraud is negligible.

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