European government is planning to end duty on alcohol imports, which may allow UK consumer to purchase duty-free alcohol and cigarettes on the internet.
It will be decided this month by the European court whether goods from European countries can be delivered to British homes free of UK duty. This could mean a big drop in tax income for the Treasury, which could lead the court to reject the idea.
Francis Jacob, the court’s advocate general, gave his suggestions to the court last December and the court will give its verdict on November 23. If the advice is granted by the court, it will become convenient for shoppers of alcohol and cigarettes to buy it from the mainland Europe, where there are often lower alcohol and tobacco duty rates.
Treasury spokesman said:
It is very important to remember that the advocate general’s opinion is just that - an opinion. The court does not always follow the Advocate-General’s opinion.
The government earns about £15bn a year from excise on alcohol and cigarettes. The European judgment will come six months after the European commission’s decision to end legal proceedings against Britain to jam up shoppers bringing in excessive quantities of alcohol and tobacco.
Jeremy Beadles, chief executive of the Wine and Spirits Trade Association said:
I think the likelihood is that the consumer will benefit and the Treasury will be hit hard by it. Retailers will have to adapt their businesses, recognizing they have much higher tax rates here than on the Continent.
