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The Federation has submitted its consultation to HM Revenue and Customs (HMRC) regarding illicit tobacco sales.

Its response took a firm stance against the sale of illicit tobacco, but “cautiously welcomed” action to tighten up the policing of the tobacco supply chain by giving Trading Standards officers the ability to issue compliance notices and the discretion to deactivate Economic Operator ID (EOID)’s, concluding that there would need to be clear guidelines as to when and how they are applied.

The damage caused by non-Track and Trace System compliant products and fixed penalty amounts – based on bands and previous compliance – were also addressed.

The Federation wrote: “The NFRN has long taken a strong stance against the sale of illicit tobacco in this country.

“Each smuggled or counterfeit pack sold is a genuine pack not sold by a tax paying independent retailer, to the detriment of their business.

“The illicit trade not only damages businesses, it also puts customers at risk through a lack of quality control in production and through the fact that few involved in the supply or sale of illicit tobacco products are greatly concerned about under aged sales.”

It added: “The NFRN fully understands the need for penalties to be proportionate to the offense committed, but the amounts proposed for financial penalties, particularly for repeat offenders or those with large quantities of illicit product, significantly fail to match the potential profits that can be made from the trade in illicit tobacco.

“Seizing legitimate stock would increase the cost of the illicit business both at the large and small scale operations and may well increase the deterrence affect of HMRC activity.

“The length of the deactivation should be influenced by the seriousness of the particular offense and the number of previous offenses that the EOID owner has been responsible for.  Repeat offenders or those involved in large scale illicit operations should face longer or permanent suspension of their EOID.

“While the NFRN opposes the introduction of tobacco licensing schemes, it is clear that a retailer who has been banned from selling tobacco because of previous offenses has no need of their EOID for the duration of the ban.”

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