EU rules against cheaper alcohol for online buyers

23-11-2006

EU rules against cheaper alcohol for online buyers
Internet shoppers hoping to stock up on cheap cigarettes and alcohol online this Christmas will be disappointed at a new ruling issued by the European Court of Justice (ECJ) today.

The European Union's top court has ruled against allowing consumers who buy tobacco and alcohol from other countries online from paying lower duties on their purchases than they would do within their home country.

Under current EU rules, consumers who wish to benefit from lower duties by buying goods abroad must transport the products, which must be for their own personal use, back to their home themselves.

But in a landmark ruling the ECJ concluded this morning that the 1992 directive in question only exempted those products "acquired by private individuals for their own use and transported by them" from being subject to excise duty on goods imported into their home country.

The European court was asked to interpret the current EU law by the Dutch supreme court after a wine club based in the Netherlands complained at being charged duty on a lorry-load of wine which had been imported from France.

In today's ruling, Europe's top judges also concluded that the existing law which allows consumers to pay lower duty on imported goods "excludes products acquired by a private individual for the use of other private individuals".

The ruling has come as a relief to alcohol and tobacco retailers, who had claimed that allowing online shoppers to avoid paying UK duty on products purchased from other EU countries would hit their trade.

Commenting on the ruling, the campaign group Retailers Against Smuggling, which is supported by the Tobacco Alliance, said that if the EU court had ruled in the opposite direction then the livelihoods of Britain's cornershop owners would have been "seriously threatened".

"It would have been inevitable that shoppers would have been tempted to buy tobacco from outside the UK because the high levels of tax here make it much cheaper for them to do it that way," said Leicester retailer, Ken Patel, national spokesman for the campaign.

"Tobacco accounts for a huge proportion of the sales of many corner shopkeepers and to have lost these valuable sales plus the add-on purchases a shopper often makes at the same time - like a daily paper or a pint of milk - would have been unsustainable for many retailers," he added.

Today's decision is also likely to be welcomed by the Treasury, which already loses revenue of over £1 billion as a result of so-called "booze cruises" in which consumers do not pay UK taxes on goods that they purchase abroad and transport back to the UK for their personal use.


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