Taxation (Cross-border Trade) Bill (HC Bill 128)

(b) the temporary admission procedure under Part 1 of the
Taxation (Cross-border Trade) Act 2018.

(3A) Where there are conditions which apply in connection with the
goods being relieved from duty or not being subject to duty, the
5customs and excise Acts shall apply to the goods as if they were
imported into the United Kingdom when they were imported into
the Isle of Man and as if corresponding conditions apply to the goods
under, or by virtue of, those Acts.”

141 In section 9 (removal of goods from United Kingdom to Isle of Man), in
10subsection (5), for “or under any EU instrument” substitute “or section 19 of
the Taxation (Cross-border Trade) Act 2018”.

Finance Act 1994

142 The Finance Act 1994 is amended as follows.

143 In section 16 (appeals to tribunal), omit subsections (11) and (12).

144 15In section 17 (interpretation), in subsection (2)—

(a) omit the definition of “the Community Customs Code”, and

(b) in the definition of “relevant duty”, for “means any EU customs
duty” substitute “means any customs duty”.

145 (1) Schedule 5 (decisions subject to review and appeal) is amended as follows.

(2) 20For the italic heading before paragraph 1 substitute “Taxation (Cross-border
Trade) Act 2018”.

(3) In paragraph 1—

(a) in the opening words, from “, so far as” to “implementing that Code,”
substitute “so far as they are made under any provision made by or
25under Part 1 of the Taxation (Cross-border Trade) Act 2018,”,

(b) in paragraph (a), for “transhipment” substitute “transit”,

(c) after paragraph (a) insert—

“(aa) any decision as to whether or not consent to the
amendment or withdrawal of any Customs or
30other declaration is to be given;”,”

(d) for paragraph (e) substitute—

“(e) any decision, in any particular case, as to whether
or not any licence, authorisation or approval is to
be granted to any person (whether in respect of any
35premises, place or area or anything else);”,”

(e) for paragraph (j) substitute—

“(j) any decision, in any particular case, as to whether
or not a fee is to be charged to any person under
regulations made under section 27 of the Taxation
40(Cross-border Trade) Act 2018 or as to the amount
of any such fee;”,”

(f) in paragraph (m), for “security”, in both places, substitute “security
or other guarantee”, and

(g) in paragraph (n)—

(i) 45omit “customs duty or”, and

(ii) omit the words from “or to do any other thing” to the end,

(h) after paragraph (n) insert—

“(na) any decision as to the time at which or the period
within which any obligation to pay any customs
duty or to do any other thing required or
5authorised as a result of provision made by or
under Part 1 of the Taxation (Cross-border Trade)
Act 2018 is to be complied with;”, and”

(i) in paragraph (o)—

(i) for “varied or revoked” substitute “varied, suspended or
10revoked”, and

(ii) at the end insert “, and a decision as to whether or not a
licence, authorisation or approval is to be suspended or
revoked or the terms of a licence, authorisation or approval
are to be varied”.

(4) 15In paragraph 2(1)—

(a) for paragraph (a) substitute—

“(a) any decision made under any regulations under
section 20, 22 or 25 (approved wharf, examination
station or temporary storage facility)—

(i) 20as to whether or not a mandatory condition
is met; or

(ii) as to whether or not a discretionary
condition is to be imposed, the terms of a
discretionary condition or whether or not a
25discretionary condition is met;

and any reference to a mandatory condition is to a
condition within subsection (1A)(a) of section 20,
22 or 25 and any reference to a discretionary
condition is to a condition within subsection
30(1A)(b) of that section;”,”

(b) after paragraph (g) insert—

“(ga) any decision consisting in the imposition of a
requirement by virtue of subsection (3A) of section
33 or as to what is or is not to be approved for the
35purposes of paragraph (a) of that subsection;”, and”

(c) omit paragraphs (j) and (k).

Terrorism Act 2000

146 In Schedule 7 to the Terrorism Act 2000 (port and border controls), in
paragraph 9—

(a) 40in sub-paragraph (2C)(c), for “transit shed” substitute “temporary
storage facility”,

(b) in sub-paragraph (3)(d), for ““transit shed”” substitute ““temporary
storage facility””, and

(c) in sub-paragraph (4)(d), for “transit shed” substitute “temporary
45storage facility”.

Finance Act 2003

147 Part 3 of the Finance Act 2003 (taxes and duties on importation and
exportation: penalties) is amended as follows.

148 (1) Section 24 (introductory) is amended as follows.

(2) In subsection (2), omit paragraphs (b), (c) and (e).

(3) In subsection (3), omit the definitions of “the European Union Customs
Code”, “Community export duty”, “Community import duty”, “customs
5duty of a preferential tariff country” and “preferential tariff country”.

(4) Omit subsections (4) to (6).

149 In section 25 (penalty for evasion), omit subsection (3).

150 (1) Section 26 (penalty for contravention of relevant rule) is amended as follows.

(2) After subsection (5) insert—

“(5A) 10Where the conduct constituting a contravention of a relevant rule is
a contravention of a condition imposed under regulations under
section 20(1A), 22(1A) or 25(1A) of the Customs and Excise
Management Act 1979—

(a) the Treasury may by regulations provide that, in prescribed
15circumstances, there are to be deemed for the purposes of
subsection (1) of this section to be further separate
contraventions of the rule, and

(b) the provision that may be made by the regulations includes
provision replicating or applying, with or without
20modifications, any provision made by section 20A(1A) or
(1B), 22A(1A) or (1B) or 25A(1A) or (1B) of the Customs and
Excise Management Act 1979.”

(3) In subsection (8)—

(a) before paragraph (a) insert—

“(za) 25Part 1 of the Taxation (Cross-border Trade) Act 2018,
as it applies in relation to the relevant tax or duty;”,
and”

(b) omit paragraphs (c) and (e).

(4) In subsection (9)—

(a) 30omit the definition of “Community customs rules”, and

(b) in the definition of “relevant international rules”, omit paragraph (b)
(together with the “or” before it).

151 In section 32 (no prosecution after demand notice for penalty under section
26)—

(a) 35the existing text becomes subsection (1), and

(b) after that subsection insert—

“(2) Nothing in subsection (1) prevents the bringing of
proceedings against a person for an offence under section
20A(1A), 22A(1A) or 25A(1A) of the Customs and Excise
40Management Act 1979 in circumstances where it is alleged
that the person is liable to a penalty of an enhanced amount.”

152 In section 38 (admissibility of certain statements and documents), omit
subsection (3).

Income Tax (Trading and Other Income) Act 2005

153 The Income Tax (Trading and Other Income) Act 2005 is amended as
follows.

154 In section 54 (trading income: penalties, interest and VAT surcharges), in
5subsection (2), in the entry relating to a penalty under section 25 or 26 of the
Finance Act 2003, for “Customs, export and import duties” substitute
“Customs duties”.

155 In section 869 (general calculation rules, etc: penalties, interest and VAT
surcharges), in subsection (4), in the entry relating to a penalty under section
1025 or 26 of the Finance Act 2003, for “Customs, export and import duties”
substitute “Customs duties”.

Borders, Citizenship and Immigration Act 2009

156 (1) Section 7 of the Borders, Citizenship and Immigration Act 2009 (customs
revenue functions of the Director) is amended as follows.

(2) 15In subsection (2), omit paragraphs (b) and (c).

(3) In subsection (7)—

(a) at the end of paragraph (aa) omit “and”, and

(b) after paragraph (aa) insert—

“(ab) Part 1 of the Taxation (Cross-border Trade) Act 2018,
20and”.

(4) In subsection (9), in paragraph (c), after “a function under” insert “retained”.

Corporation Tax Act 2009

157 In section 1303 of the Corporation Tax Act 2009 (general calculation rules,
etc: penalties, interest and VAT surcharges), in subsection (2), in the entry
25relating to a penalty under section 25 or 26 of the Finance Act 2003, for
“Customs, export and import duties” substitute “Customs duties”.

Section 43

SCHEDULE 8 VAT amendments connected with withdrawal from EU

Part 1 30Amendments of Value Added Tax Act 1994

Amendment of the Value Added Tax Act 1994

1 The Value Added Tax Act 1994 is amended as follows.

2 (1) Section 1 (imposition of charge to value added tax) is amended as follows.

(2) Omit subsection (3).

(3) 35In subsection (4)—

(a) for “from places outside the member States” substitute “into the
United Kingdom”, and

(b) for “a duty of customs” substitute “import duty”.

3 In section 2 (rate of VAT), in subsection (1)—

(a) 5omit paragraph (b) (together with the “and” at the end of the
paragraph), and

(b) in paragraph (c), omit “from a place outside the member States”.

4 Omit section 3A (supplies of electronic, telecommunication and
broadcasting services: special accounting schemes).

5 10In Section 5 (meaning of supply: alteration by Treasury order), in subsection
(3), in the words after paragraph (c), omit the words from “and may provide
that paragraph 6” to the end.

6 (1) Section 6 (time of supply) is amended as follows.

(2) Omit subsections (7) and (8).

(3) 15In subsection (14), for “subsections (2) to (8)” substitute “subsections (2) to
(6)”.

7 (1) Section 7 (place of supply of goods) is amended as follows.

(2) In subsection (1), omit “14,”.

(3) Omit subsections (4) and (5).

(4) 20In subsection (6)(a), omit “from a place outside the member States”.

(5) Omit subsection (9).

(6) After subsection (11) insert—

“(12) The Commissioners may by regulations provide that any rule for
determining where a supply of goods is made is subject to such
25conditions relating to the notification of matters to the
Commissioners, or such other conditions, as may be specified in the
regulations.”

8 In section 7A (place of supply of services), for subsection (4) substitute—

“(4) For the purposes of this Act a person is a relevant business person in
30relation to a supply of services if—

(a) the person carries on a business, and

(b) the services are not received by the person wholly for private
purposes,

whether or not the services are received in the course of business.”

9 35In section 9 (place where supplier or recipient of services belongs), omit
subsection (6).

10 In section 9A (reverse charge on gas, electricity, heat or cooling supplied by
persons outside the United Kingdom), in subsection (5)(a)—

(a) for “situated within the territory of a member State” substitute “in
40the United Kingdom”, and

(b) for “such a system” substitute “a natural gas system in the United
Kingdom”.

11 Omit sections 10 to 14 (acquisition of goods from member States) and the
italic heading before those sections.

12 In the italic heading before section 15, omit “from outside the member
States”.

13 5For section 16 substitute—

“16 Application of customs enactments

(1) The provision made by or under—

(a) the Customs and Excise Acts 1979 (as defined in the
Management Act), and

(b) 10the other enactments for the time being having effect
generally in relation to duties of customs and excise charged
by reference to the importation of goods into the United
Kingdom,

apply (so far as relevant) in relation to any VAT chargeable on the
15importation of goods into the United Kingdom as they apply in
relation to any duty of customs or excise.

(2) The provision made by section 1(4) for VAT on the importation of
goods to be charged and payable as if it were import duty is to be
taken as applying, in relation to any VAT chargeable on the
20importation of the goods, the provision made by or under Part 1 of
TCTA 2018.

(3) The Commissioners may by regulations—

(a) provide for exceptions from the effect of subsection (1) or (2),
or

(b) 25provide for the provision mentioned in subsection (1) or (2)
to have effect with modifications specified in the regulations.

(4) Subsections (1) and (2) do not apply so far as the context otherwise
requires.

(5) Regulations under section 105 of the Postal Services Act 2000 (which
30provides for the application of customs enactments to postal packets)
may make special provision in relation to VAT.”

14 After section 16 insert—

“16A Territories forming part of a customs union with UK

(1) This section applies if there are arrangements that have effect for the
35purposes of import duty as a result of section 31 of TCTA 2018
(territories forming part of a customs union with UK).

(2) The Commissioners may make regulations charging VAT on
customs union acquisitions.

(3) A “customs union acquisition” is an acquisition from a country or
40territory in the customs union—

(a) of goods which enter the United Kingdom, and

(b) which is not exempted by the regulations.

(4) VAT chargeable under the regulations is a liability of the person who
acquires the goods and (subject to provisions about accounting and
45payment) becomes due at the time of acquisition.

(5) Among other provision that may be made, the regulations—

(a) may require persons who acquire goods from a country or
territory in the customs union to register under the
regulations for the purpose of accounting for VAT charged
5on customs union acquisitions,

(b) may determine the cases in which goods are regarded as
acquired from any country or territory, and

(c) may determine the time at which an acquisition is regarded
as taking place.

(6) 10Regulations under this section may—

(a) make different provision for different purposes, and

(b) modify the application of this Act in relation to cases dealt
with by the regulations.

(7) For the purposes of this section “country or territory in the customs
15union” means any country or territory with which the United
Kingdom has a customs union within the meaning of section 31 of
TCTA 2018.”

15 After that section insert—

“16B Postal packets

(1) 20The Commissioners may by regulations impose a liability to VAT on
a person outside the United Kingdom in respect of the entry of goods
into the United Kingdom if the person sent, or arranged for the
sending of, the goods to their recipient in a postal packet (within the
meaning of the Postal Services Act 2000).

(2) 25The regulations may—

(a) provide that a liability to VAT arises only in relation to goods
of a value described in the regulations,

(b) provide that in cases specified in the regulations, other
persons are jointly and severally liable for the VAT, and

(c) 30provide that the entry of the goods into the United Kingdom
is not an importation for the purposes of this Act.

(3) Among other provision that may be made by the regulations, the
regulations may make provision—

(a) requiring persons to register under the regulations for the
35purpose of accounting for VAT imposed under the
regulations,

(b) modifying the application of this Act in relation to cases dealt
with by the regulations, and

(c) requiring persons to provide information to the
40Commissioners about the goods or the person who sent, or
arranged for the sending of, the goods.

(4) Regulations under this section may make different provision for
different purposes.”

16 (1) Section 17 (free zone regulations) is amended as follows.

(2) 45In subsection (1), omit “from places outside the member States”.

(3) In subsection (2), omit “Subject to any contrary provision made by any
directly applicable Community provision,”.

(4) In subsection (5)(a), omit “into the United Kingdom”.

17 (1) Section 18 (place and time of acquisition or supply) is amended as follows.

(2) 5For subsection (1) substitute—

“(1) A supply of goods which are subject to a warehousing regime is to
be treated, for the purposes of this Act, as taking place outside the
United Kingdom where —

(a) those goods have been brought into the United Kingdom,

(b) 10the material time of that supply is while those goods are
subject to that regime and before the duty point, and

(c) those goods are not mixed with any dutiable goods which
were produced or manufactured in the United Kingdom.”

(3) In subsection (2)—

(a) 15omit paragraph (a) (together with the “or” at the end of it), and

(b) in paragraph (b)(i), omit “or acquired from another member State”.

(4) In subsection (3), omit “acquisition or” in both places.

(5) In subsection (4)—

(a) in the opening words, omit “acquisition or” in both places,

(b) 20in paragraph (a), omit “acquisition or”, and

(c) in paragraph (b), omit “in the case of a supply,”.

(6) In subsection (6)—

(a) in the definition of “dutiable goods”, in paragraph (b), omit “EU
customs duty or”,

(b) 25in the definition of “the duty point”, in paragraph (b)—

(i) for the words from “any Community” to “be incurred”
substitute “import duty is incurred in respect of the goods”,

(ii) for the words from “the corresponding” to “duty or”
substitute “the time a debt in respect of any”, and

(iii) 30after “dutiable goods” insert “is incurred in respect of the
goods”,

(c) in the definition of “material time”—

(i) in paragraph (a), omit “acquisition or” and “or 12(3)”, and

(ii) omit paragraph (b) (but not the “and” at the end of the
35paragraph), and

(d) in the definition of “warehouse”—

(i) in the opening words, for “any member State” substitute “the
United Kingdom”,

(ii) for paragraph (a) substitute—

• “(“a)

  40import duty;”,”

(iii) in paragraph (c), omit “into any member State”, and

(iv) in paragraph (d), omit the words from “or any duty” to the
end.

(7) In subsection (7)—

(a) 45omit “(whether in the same or different member States)”, and

(b) omit “in a member State”.

(8) In the heading, omit “acquisition or”.

18 In section 18A (fiscal warehousing), in subsection (4)—

(a) in paragraph (b), omit “(as defined in the Management Act)”,

(b) 5omit paragraphs (c) and (d),

(c) in paragraph (e), for “(a) to (d)”, in both places it occurs, substitute
“(a) and (b)”, and

(d) in paragraph (f), for “(a) to (d)” substitute “(a) and (b)”.

19 (1) Section 18B (fiscally warehoused goods: relief) is amended as follows.

(2) 10Omit subsection (1).

(3) In subsection (2), omit “also”.

(4) In subsection (2A), omit “(1)(d) or”.

(5) In subsection (3), omit “acquisition or”.

(6) In subsection (4), omit “acquisition or” in both places.

(7) 15For subsection (5) substitute—

“(5) VAT is chargeable on a supply made by a person who is not a taxable
person, but who would be were it not for paragraph 1(9) of Schedule
1, where—

(a) subsection (4) applies to that supply, and

(b) 20that supply is taxable and not zero-rated.”

(8) For subsection (6) substitute—

“(6) In this section “eligible goods” means goods—

(a) of a description falling within Schedule 5A,

(b) in the case of imported goods—

(i) 25upon which any import duty has been paid or
deferred (by virtue of the customs and excise Acts or
any subordinate legislation made under those Acts),
and

(ii) upon which any VAT chargeable under section 1(1)(c)
30has been paid, or deferred (by virtue of the customs
and excise Acts or any subordinate legislation made
under those Acts), and

(c) in the case of goods subject to a duty of excise, upon which
any excise duty has been paid or deferred under section 127A
35of the Management Act.”

(9) In subsection (7)—

(a) for “an acquisition or supply” substitute “a supply”, and

(b) for “the acquisition or supply” substitute “the supply”.

20 In section 18C (warehouses and fiscal warehouses: services), in subsection
40(4)(b), for “Community customs provisions or warehousing regulations”
substitute “the customs and excise Acts or any subordinate legislation made
under those Acts”.

21 (1) Section 18D (removal from warehousing: accountability) is amended as
follows.

(2) In subsection (1), omit the words from “and any acquisition” to the end.

(3) In subsection (2)—

(a) 5in the opening words, omit “or acquisition”, and

(b) in paragraph (a), omit “or acquisition”.

22 In section 18F (sections 18A to 18E: supplementary), in subsection (1)—

(a) at the appropriate place insert—

• “““the customs and excise Acts” has the same meaning as
  10in the Management Act;”,”

(b) in the definition of “material time”—

(i) in paragraph (a), omit “acquisition or” and “or 12(3)”, and

(ii) omit paragraph (b), and

(c) omit the definition of “warehousing regulations”.

23 15Omit section 20 (valuation of acquisitions from other member States).

24 (1) Section 21 (value of imported goods) is amended as follows.

(2) For subsection (1) substitute—

“(1) For the purposes of this Act, the value of imported goods is (subject
to subsections (2) to (4)) their value as if determined under TCTA
202018 for the purposes of import duty (whether or not the goods are
subject to import duty).”

(3) In subsection (2)—

(a) in the opening words, omit “from a place outside the member
States”, and

(b) 25in paragraph (c), omit “from a place outside the member States” and
“or another member State”.

(4) In subsection (2A)—

(a) in paragraph (a), for “the procedure specified in subsection (2B)
below” substitute “the temporary admission procedure under Part 1
30of TCTA 2018”, and

(b) in paragraph (b), omit “from a place outside the member States”.

(5) Omit subsection (2B).

(6) In subsection (3), in paragraph (a), omit “from a place outside the member
States”.

(7) 35In subsection (4), omit “from a place outside the member States”.

(8) In subsection (6D), for “any goods imported from outside the member
States” substitute “imported goods”.

25 (1) Section 24 (input tax and output tax) is amended as follows.

(2) In subsection (1)—

(a) 40omit paragraph (b) (but not the “and” at the end of the paragraph),
and

(b) in paragraph (c), omit “from a place outside the member States”.