Select Committee on Scottish Affairs Minutes of Evidence

Examination of Witness (Questions 440 - 448)



  440. Is allowing them to bring in a reasonable amount legal? If it is illegal to impose a limit, is it not illegal to stop them bringing in any amount they want?
  (Dr Crawford) I am not sure actually what the legal force of these reasonable amounts are. If you bring in a milk tanker full and say you are having a wedding party, the Customs officer might take your number.

  441. Some wedding parties will take two tankers.

Sir Robert Smith

  442. Will cross-border shopping continue to be a problem so long as the duty disparities remain as they are? Does the revenue lost represent a serious problem for the Treasury?
  (Dr Crawford) I think at the moment beer, wine and spirit revenues run at about £11 billion a year. Again, it depends who you ask, but the last time I asked I was told that the cost of cross-border shopping was about £300 million. So that is relatively small beer compared with the general level.


  443. The Scotch Whisky Association argued that "the UK duty structure which discriminates against spirits . . . is based on a tax system formulated in the early 1900s". do you agree with the argument that the system of taxing alcohol in the UK is outdated and if so, how do you think it might be reformed?
  (Dr Crawford) I think it is probably an historical accident. If I were to reform it I would tax all drinks on their alcohol by volume. At the moment if you translate the tax on beer into alcohol by volume it is about £11 for a pure litre of alcohol, whereas if you were to drink a pure litre of alcohol and survive, and you drank it in the form of spirits then it would be about double. So there is quite a big disparity. I would level it up.

  444. What about wine?
  (Dr Crawford) I think wine runs at about £15. Did I answer everything you asked?

Miss Begg

  445. I was wondering whether you would expect the Treasury to get the same tax if you had a levelling down or a levelling up?
  (Dr Crawford) Well you could do either. I think the two main things that would be in the back of their minds would be the social and health spin-offs you would get from that and whether there would be any significant loss of tax revenue from levelling spirits down, for example and you then make the calculation accordingly.

  446. It is a fair chunk of the Treasury's tax take and I cannot imagine them wanting any of that. Are you aware of any statistics that would allow them to keep that avenue open by say increasing the level for beer?
  (Dr Crawford) I would have to sit down and work it out. I can certainly let you know but it should be relatively straightforward to design a revenue neutral form of levying.

  Miss Begg: That would be useful for us because I suspect the beer industry might not be very happy, though spirits might be.

Sir Robert Smith

  447. Do you have a rough idea of how that £11 billion is made up between spirits, wine and beer at the moment?
  (Dr Crawford) A very rough idea is that half of it comes from beer and the other half from the other two and the shares of that are roughly equal.


  448. We seem to have whizzed through these questions but I think that is largely because of the speed at which you are answering them. Do have any final remarks or points you would like to bring to our attention?
  (Dr Crawford) I do not think so.

  Chairman: In that case I would like to thank you for the very efficient way in which you answered our questions. The answers you have given us will be very helpful to us when we come to prepare our report. On behalf of the Committee I thank you very much for your attendance here.

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