Foreword

We were asked to do a reply to this consultation by a number of readers as

they all felt it was quite daunting, which indeed it is. The questions in our
honest opinion are loaded to agree with what HMRC propose.
You can add, delete any of our answers as you wish or you can leave them as
they are. We have taken note of all our readers had to say and included them
in our answers.
For the benefit of any doubts held by the HMRC Consultation Team, the
replies you receive will be from private individuals and not companies. All our
answers are to that effect (although private individuals may alter our
answers).
HMRC intend to reply to this consultation with one answer. We have the right
to do the same albeit the answers may differ slightly depending upon the
individual.

Consultation Questions
Question 1: Does the proposed definition encompass all forms of raw
tobacco, which could be used to manufacture tobacco products?
As members of the EU, there should be no changes unless the EU Directives
and Regulations change. Raw Tobacco is defined as an agricultural product
within the EU.

Question 2: Should plants which have not been harvested but are still growing
in containers such as pots or bags also be included to prevent an alternative
route to evade duty?
As members of the EU, there should be no changes unless the EU Directives
and Regulations change. Raw Tobacco is defined as an agricultural product
within the EU.

Question 3: We would very much like to hear from businesses and individuals
who use raw tobacco for purposes other than manufacturing tobacco

products on which duty is payable, including manufacturers of e-cigarette

fluids. It would be extremely helpful to know:

the nature of your usage;

There are many uses for raw tobacco, other than smoking. This range
includes but is not limited to e-cig liquid, whole leaf vapourising, potpourri,
insecticide, animal bedding, snuff, cosmetics, alternative medicine, dietary
supplements and fragrances.
. where and in what quantities you currently source raw tobacco,
including
Internet, small quantities for personal use.
. the approximate quantities used;
I find this question intrusive and unnecessary.
.

how you feel these proposals would impact you;

I believe that they would seriously violate my Human Rights and my right as
an EU citizen to legitimately purchase an EU defined legal product. HMRC
already have powers to investigate individuals should they have a valid
reason. These proposals are likely to destroy a legitimate trade and leave me
with fewer (or no) suppliers to choose from. The lack of competition will
inevitably result in increased prices.

is there an alternative substance that you could use in place of

tobacco?

No.
Question 4: What are your views on a simplified scheme for low volume users
for non-smoking purposes:

Do you think there should be a simplified scheme for low-volume users

and if so, why?

Yes, the current one that exists within the EU Directives and Regulations.
These are already adequate if they were implemented properly. Requiring
purchasers of a legal product to register is unprecedented.
.

At what level do you believe that the threshold should be set for a lowvolume user of raw tobacco for non-smoking purposes?

There should be no threshold for own use. Any individual purchasing other
than for own use would be running a business that would need to be declared
to HMRC for tax purposes.

How could HMRC ensure that such a scheme was not exploited to
avoid
Tobacco Products Duty?

HMRC have access to all VAT records and especially purchases/movement

within the EU for raw tobacco where only companies VAT registered can
purchase it. I as a private individual cannot. I can from outside of the EU but
then it is subject to import duty etc from HMRC. HMRC can then follow up any
enquiry they deem necessary. The data and records are there.

Please supply any evidence you have of usage to support your view.

No l do not feel comfortable giving anyone access to my personal data and it

is not a view but fact.

Question 5: If you would be required to register under this scheme, for which
other taxes and duties are you already registered?
None, private individual, not a business

Question 6: Paragraph 19 includes factors that will be considered as part of a

fit and proper test:

What is your view on the suggested factors that would be included

in a fit
and proper test?

They are outrageous. It would be seriously contrary to my Human Rights as a

citizen of the EU that l could be refused registration merely on someone's
unsubstantiated suspicions or any unspent convictions etc. The Hoverspeed
ruling (R (Hoverspeed) v C&E Comrs [2002] EWHC 1630 ) confirmed that it was not
up to private individuals to prove their innocence, but for HMRC to prove their
guilt.
The criteria HMRC suggest for registration are draconian to say the least.
HMRC include in these criteria that they should be satisfied that there are "no
risks of duty evasion". It is clearly impossible to attain such an absolute.
Another criteria is that you cannot have any unspent convictions.
"any"? HMRC cannot be serious.

The remaining criteria are just as bad.

It seems that HMRC do not wish for anyone to have registration. I realize that
there will be an appeals/tribunal process but if this is anything like that of the
Border Force then one cannot justifiably have any faith in them.
Why are just importers/users of raw tobacco being asked to register to this
proposed HMRC scheme when cross-border shoppers who bring back non
UK duty paid smoking products are seemingly exempt. ? The cross border
shoppers have no limits/threshold set either. All they have is guidelines.

Are there any additional items you think should be considered as part of
this fit and proper test?
None, see previous answer.

Question 7: What record keeping requirements do you consider would be

necessary to assure HMRC that raw tobacco is being used for a legitimate
purpose, i.e. is not being used to illegally manufacture tobacco products?
All my purchases are by bankcard and thus show on my bank statements and
those of the Internet companies that l purchase from. Nothing else is
justifiable, given l am a private individual end user, not a business.

Question 8: Paragraph 25 states that HMRC will establish at the point of

importation that raw tobacco is destined for a registered holder. It may
therefore be necessary for the carrier or owner of raw tobacco being imported
to provide proof of destination at the border. Are there any issues you can
identify with this requirement?
To suggest that my supplier (or others like them) would have to wait until they
have enough orders from such as myself before they can import a shipment of
fully allocated raw tobacco is ridiculous. I could be waiting months for my
order. I am certain that organised crime would welcome your proposal though,
as they would not be inconvenienced whereas legitimate businesses would be
ruined.

Question 9: Are there any potential wider consequences of this system that
we have not identified here?
Yes, companies within the UK would either have to close or relocate to
another EU country. This would leave a void that organised crime would very
quickly fill. Also any private individual could still purchase from other EU
Internet companies that have moved and take the small risk of any shipment

they purchase being seized. Even if this happens HMRC cannot issue a
penalty for duty evaded as raw tobacco will still remain non dutiable.
No doubt Internet companies outside the EU will still operate as usual, with
smaller but more frequent shipments. Whether HMRC would be able to
intercept all these parcels is very doubtful indeed. Regardless, given the low
base price of raw tobacco, those Internet companies will invariably just send
out a replacement free of charge.

Question 10: Are there any equality issues raised by these proposals, such as
a disproportionate impact on any particular group of the population such as
ethnic groups or disabled people, for example?
None l can see.
Question 11: Do you have any views on the potential impact of this scheme
on businesses affected, including potential costs and burdens and any
suggestions for how these can be kept to a minimum?
See answer to Question 9. To keep costs and burdens to a minimum l implore
you to use the data and records you already have. Any irregularities can be
easily spotted. Such as 1 tonne going to an ice cream factory!
(http://www.bailii.org/uk/cases/UKFTT/TC/2013/TC02964.html)

Question 12: What documentation do you consider it reasonable and

necessary for an importer or consignee to provide to prove that a
consignment of raw tobacco is destined for a legitimate end use?
HMRC already have access to all VAT records and especially
purchases/movement within the EU for raw tobacco where only companies
VAT registered can purchase it. I as a private individual cannot. I can from
outside of the EU but then it is subject to import duty etc from HMRC, who can
already follow up any enquiry they deem necessary.
Note:- it is impossible to prove that raw tobacco is destined for a legitimate
end user. Your legal department will no doubt confirm this, if you cannot see it.

Question 13: What are your views on broadening the seizure powers,
including any issues, potential costs and burdens. Please supply any
evidence you have to support your view.
Border Force are widely considered unfit for purpose and in my and many
others view justifiably so. I can foresee many problems giving Border Force
extra powers of seizure.

It is well factually documented that some Border Force officers are over
zealous, bend the rules/regs and sometimes actually lie in order to get a
seizure. Giving them extra powers will only allow them to victimise more
legitimate private individuals and companies.
See http://nothing-2-declare.blogspot.co.uk for many factual examples.

Question 14: Are there any potential wider consequences of increasing

existing powers that we have not identified here?
Yes we should always be working towards harmonising with the EU and not
creating different rules/regs that will make matters far worse. Your point that 2
countries have created different rules calls for closer scrutiny. Poland has
introduced excise duty on raw tobacco in direct contradiction to EU
Directives/Regs and is facing a legal challenge.
Ireland on the other hand continually introduces everything they can think of
regardless of the consequences. In 2013 Ireland was 3rd (in 2011 it was
Bulgaria!) in the table re tobacco duty avoidance (smuggling). The only 2
countries ahead of them were Latvia and Lithuania (Irish Tobacco
manufacturers Advisory Committee). Yet, Latvia and Lithuania are actually
reducing this tobacco duty avoidance year by year. Ireland is not, and looks
odds on for becoming number 1 in the table very soon. Surely it is not the
intention of HMRC to compete for this embarrassing position?
Organised crime will be waiting eagerly for proposals such as those in this
consultation to come into force. They already operate outside of any
regulations HMRC have. All they have to do is increase their trade to fill the
gap created by these proposals that will destroy legitimate businesses.

Question 15: Do you have any alternative proposals for the control of raw
tobacco and the prevention of avoidance of Tobacco Products Duty?
Yes, harmonise with EU, use the data and records you already have. Do not
drive the raw tobacco trade underground into the hands of organised crime.
Work with the public, not against them. Certainly do not suggest that virtually
no end users are legitimate, as you have done in this consultation. If private
individuals are condemned out of hand then what have they to lose by
becoming what you accuse them of?