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“Community export duty” means any of the duties, charges or levies | |
which are export duties within the meaning of the Community | |
Customs Code (as at 9th April 2003, see the definition of “export duties” | |
in Article 4(11) of that Code); | |
“Community import duty” means any of the duties, charges or levies | 5 |
which are import duties within the meaning of the Community | |
Customs Code (as at 9th April 2003, see the definition of “import | |
duties” in Article 4(10) of that Code); | |
“contravene” includes fail to comply with; | |
“customs duty of a preferential tariff country” includes a reference to any | 10 |
charge imposed by a preferential tariff country and having an | |
equivalent effect to customs duty payable on the importation of goods | |
into the territory of that country; | |
“demand notice” means a demand notice within the meaning of section | |
30; | 15 |
“import VAT” means value added tax chargeable by virtue of section | |
1(1)(c) of the Value Added Tax Act 1994 (c. 23) (importation of goods | |
from places outside the member States); | |
“notice” means notice in writing; | |
“preferential tariff country” means a country outside the European | 20 |
Community which is, or is a member of a group of countries which is, | |
party to an agreement falling within Article 20(3)(d) of the Community | |
Customs Code (preferential tariff agreements with the Community); | |
“prescribed” means specified in, or determined in accordance with, | |
regulations made by the Treasury; | 25 |
“relevant rule”, in relation to any relevant tax or duty, has the meaning | |
given by subsection (8) of section 26 (as read with subsection (9) of that | |
section); | |
“representative”, in relation to any person, means— | |
(a) his personal representative, | 30 |
(b) his trustee in bankruptcy or interim or permanent trustee, | |
(c) any receiver or liquidator appointed in relation to that person or | |
any of his property, | |
or any other person acting in a representative capacity in relation to that | |
person. | 35 |
(4) References in this Part to the Community Customs Code are references to that | |
Code as from time to time amended, whether before or after the coming into | |
force of this Part. | |
(5) The Treasury may by order amend this Part for the purpose of replacing any | |
reference to, or to a provision of,— | 40 |
(a) the Community Customs Code, or | |
(b) any instrument referred to in this Part by virtue of an order under this | |
subsection, | |
with a reference to, or (as the case may be) to a provision of, a different | |
instrument. | 45 |
(6) A statutory instrument containing an order under subsection (5) may not be | |
made unless a draft of the instrument has been laid before, and approved by a | |
resolution of, the House of Commons. | |
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(7) Except for this subsection and section 41 (which accordingly come into force on | |
the passing of this Act), this Part comes into force on such day as the Treasury | |
may by order appoint. | |
The penalties | |
25 Penalty for evasion | 5 |
(1) In any case where— | |
(a) a person engages in any conduct for the purpose of evading any | |
relevant tax or duty, and | |
(b) his conduct involves dishonesty (whether or not such as to give rise to | |
any criminal liability), | 10 |
that person is liable to a penalty of an amount equal to the amount of the tax or | |
duty evaded or, as the case may be, sought to be evaded. | |
(2) Subsection (1) is subject to the following provisions of this Part. | |
(3) Nothing in this section applies in relation to any customs duty of a preferential | |
tariff country. | 15 |
(4) Any reference in this section to a person’s “evading” any relevant tax or duty | |
includes a reference to his obtaining or securing, without his being entitled to | |
it,— | |
(a) any repayment, rebate or drawback of any relevant tax or duty, | |
(b) any relief or exemption from, or any allowance against, any relevant tax | 20 |
or duty, or | |
(c) any deferral or other postponement of his liability to pay any relevant | |
tax or duty or of the discharge by payment of any such liability, | |
and also includes a reference to his evading the cancellation of any entitlement | |
to, or the withdrawal of, any such repayment, rebate, drawback, relief, | 25 |
exemption or allowance. | |
(5) In relation to any such evasion of any relevant tax or duty as is mentioned in | |
subsection (4), the reference in subsection (1) to the amount of the tax or duty | |
evaded or sought to be evaded is a reference to the amount of— | |
(a) the repayment, rebate or drawback, | 30 |
(b) the relief, exemption or allowance, or | |
(c) the payment which, or the liability to make which, is deferred or | |
otherwise postponed, | |
as the case may be. | |
(6) Where, by reason of conduct falling within subsection (1) in the case of any | 35 |
relevant tax or duty, a person— | |
(a) is convicted of an offence, | |
(b) is given, and has not had withdrawn, a demand notice in respect of a | |
penalty to which he is liable under section 26, or | |
(c) is liable to a penalty imposed upon him under any other provision of | 40 |
the law relating to that relevant tax or duty, | |
that conduct does not also give rise to liability to a penalty under this section | |
in respect of that relevant tax or duty. | |
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26 Penalty for contravention of relevant rule | |
(1) If, in the case of any relevant tax or duty, a person of a prescribed description | |
engages in any conduct by which he contravenes— | |
(a) a prescribed relevant rule, or | |
(b) a relevant rule of a prescribed description, | 5 |
he is liable to a penalty under this section of a prescribed amount. | |
(2) Subsection (1) is subject to the following provisions of this Part. | |
(3) The power conferred by subsection (1) to prescribe a description of person | |
includes power to prescribe any person (without further qualification) as such | |
a description. | 10 |
(4) Different penalties may be prescribed under subsection (1) for different cases | |
or different circumstances. | |
(5) Any amount prescribed under subsection (1) as the amount of a penalty must | |
not be more than £2,500. | |
(6) The Treasury may by order amend subsection (5) by substituting a different | 15 |
amount for the amount for the time being specified in that subsection. | |
(7) A statutory instrument containing an order under subsection (6) may not be | |
made unless a draft of the instrument has been laid before, and approved by a | |
resolution of, the House of Commons. | |
(8) In this Part “relevant rule”, in relation to any relevant tax or duty, means any | 20 |
duty, obligation, requirement or condition imposed by or under any of the | |
following— | |
(a) the Customs and Excise Management Act 1979 (c. 2), as it applies in | |
relation to the relevant tax or duty; | |
(b) any other Act, or any statutory instrument, as it applies in relation to | 25 |
the relevant tax or duty; | |
(c) in the case of customs duty, Community export duty or Community | |
import duty, Community customs rules; | |
(d) in the case of import VAT, Community customs rules as they apply in | |
relation to import VAT; | 30 |
(e) any directly applicable Community legislation relating to the relevant | |
tax or duty; | |
(f) any relevant international rules applying in relation to the relevant tax | |
or duty. | |
(9) In subsection (8)— | 35 |
“Community customs rules” means customs rules, as defined in Article 1 | |
of the Community Customs Code; | |
“relevant international rules” means international agreements so far as | |
applying in relation to a relevant tax or duty and having effect as part | |
of the law of any part of the United Kingdom by virtue of— | 40 |
(a) any Act or statutory instrument, or | |
(b) any directly applicable Community legislation. | |
27 Exceptions from section 26 | |
(1) A person is not liable to a penalty under section 26 if he satisfies— | |
(a) the Commissioners, or | 45 |
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(b) on appeal, an appeal tribunal, | |
that there is a reasonable excuse for his conduct. | |
(2) For the purposes of subsection (1) none of the following is a reasonable | |
excuse— | |
(a) an insufficiency of funds available to any person for paying any | 5 |
relevant tax or duty or any penalty due; | |
(b) that reliance was placed by any person on another to perform any task; | |
(c) that the contravention is attributable, in whole or in part, to the conduct | |
of a person on whom reliance to perform any task was so placed. | |
(3) Where, by reason of conduct falling within subsection (1) of section 26 in the | 10 |
case of any relevant tax or duty, a person— | |
(a) is prosecuted for an offence, | |
(b) is given, and has not had withdrawn, a demand notice in respect of a | |
penalty to which he is liable under section 25, or | |
(c) is liable to a penalty imposed upon him under any other provision of | 15 |
the law relating to that relevant tax or duty, | |
that conduct does not also give rise to liability to a penalty under section 26 in | |
respect of that relevant tax or duty. | |
(4) A person is not liable to a penalty under section 26 in respect of any conduct, | |
so far as relating to import VAT, if in respect of that conduct— | 20 |
(a) he is liable to a penalty under any of sections 62 to 69A of the Value | |
Added Tax Act 1994 (c. 23) (penalty for contravention of statutory | |
requirements as to VAT), or | |
(b) he would be so liable but for section 62(4), 63(11), 64(6), 67(9), 69(9) or | |
69A(7) of that Act (conduct resulting in conviction, different penalty | 25 |
etc). | |
28 Liability of directors etc where body corporate liable to penalty for evasion | |
(1) Where it appears to the Commissioners— | |
(a) that a body corporate is liable to a penalty under section 25, and | |
(b) that the conduct giving rise to the penalty is, in whole or in part, | 30 |
attributable to the dishonesty of a person who is, or at the material time | |
was, a director or managing officer of the body corporate (a “relevant | |
officer”), | |
the Commissioners may give a notice under this section to the body corporate | |
(or its representative) and to the relevant officer (or his representative). | 35 |
(2) A notice under this section must state— | |
(a) the amount of the penalty referred to in subsection (1)(a) (the “basic | |
penalty”), and | |
(b) that the Commissioners propose, in accordance with this section, to | |
recover from the relevant officer such portion (which may be the | 40 |
whole) of the basic penalty as is specified in the notice. | |
(3) If a notice is given under this section, this Part shall apply in relation to the | |
relevant officer as if he were personally liable under section 25 to a penalty | |
which corresponds to that portion of the basic penalty specified in the notice. | |
(4) If a notice is given under this section— | 45 |
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(a) the amount which may be recovered from the body corporate under | |
this Part is limited to so much (if any) of the basic penalty as is not | |
recoverable from the relevant officer by virtue of subsection (3), and | |
(b) the body corporate is to be treated as discharged from liability for so | |
much of the basic penalty as is so recoverable from the relevant officer. | 5 |
(5) In this section “managing officer”, in relation to a body corporate, means— | |
(a) a manager, secretary or other similar officer of the body corporate, or | |
(b) a person purporting to act in any such capacity or as a director. | |
(6) Where the affairs of a body corporate are managed by its members, this section | |
applies in relation to the conduct of a member in connection with his functions | 10 |
of management as if he were a director of the body corporate. | |
Reduction of amount of penalty | |
29 Reduction of penalty under section 25 or 26 | |
(1) Where a person is liable to a penalty under section 25 or 26— | |
(a) the Commissioners (whether originally or on review) or, on appeal, an | 15 |
appeal tribunal may reduce the penalty to such amount (including nil) | |
as they think proper; and | |
(b) the Commissioners on a review, or an appeal tribunal on an appeal, | |
relating to a penalty reduced by the Commissioners under this | |
subsection may cancel the whole or any part of the reduction | 20 |
previously made by the Commissioners. | |
(2) In exercising their powers under subsection (1), neither the Commissioners nor | |
an appeal tribunal are entitled to take into account any of the matters specified | |
in subsection (3). | |
(3) Those matters are— | 25 |
(a) the insufficiency of the funds available to any person for paying any | |
relevant tax or duty or the amount of the penalty, | |
(b) the fact that there has, in the case in question or in that case taken with | |
any other cases, been no or no significant loss of any relevant tax or | |
duty, | 30 |
(c) the fact that the person liable to the penalty, or a person acting on his | |
behalf, has acted in good faith. | |
Demand notices | |
30 Demands for penalties | |
(1) Where a person is liable to a penalty under this Part, the Commissioners may | 35 |
give to that person or his representative a notice in writing (a “demand notice”) | |
demanding payment of the amount due by way of penalty. | |
(2) An amount demanded as due from a person or his representative in | |
accordance with subsection (1) is recoverable as if it were an amount due from | |
the person or, as the case may be, the representative as an amount of customs | 40 |
duty. | |
This subsection is subject to— | |
(a) any appeal under section 36 (appeals to tribunal); and | |
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(b) subsection (3). | |
(3) An amount so demanded is not recoverable if or to the extent that— | |
(a) the demand has subsequently been withdrawn; or | |
(b) the amount has been reduced under section 29. | |
31 Time limits for demands for penalties | 5 |
(1) A demand notice may not be given— | |
(a) in the case of a penalty under section 25, more than 20 years after the | |
conduct giving rise to the liability to the penalty ceased, or | |
(b) in the case of a penalty under section 26, more than 3 years after the | |
conduct giving rise to the liability to the penalty ceased. | 10 |
(2) A demand notice may not be given more than 2 years after there has come to | |
the knowledge of the Commissioners evidence of facts sufficient in the opinion | |
of the Commissioners to justify the giving of the demand notice. | |
(3) A demand notice— | |
(a) may be given in respect of a penalty to which a person was liable under | 15 |
section 25 or 26 immediately before his death, but | |
(b) in the case of a penalty to which the deceased was so liable under | |
section 25, may not be given more than 3 years after his death. | |
32 No prosecution after demand notice for penalty under section 26 | |
Where a demand notice is given demanding payment of an amount due by | 20 |
way of penalty under section 26 in respect of any conduct of a person, no | |
proceedings may be brought against that person for any offence constituted by | |
that conduct (whether or not the demand notice is subsequently withdrawn). | |
Reviews | |
33 Right to review of certain decisions | 25 |
(1) If, in the case of any relevant tax or duty, the Commissioners give a person or | |
his representative a notice informing him— | |
(a) that they have decided that the person has engaged in conduct by | |
which he contravenes a relevant rule, and | |
(b) that the person is, in consequence, liable to a penalty under section 26, | 30 |
but | |
(c) that they do not propose to give a demand notice in respect of the | |
penalty, | |
the person or his representative may give a notice to the Commissioners | |
requiring them to review the decision mentioned in paragraph (a). | 35 |
(2) Where the Commissioners give a demand notice to a person or his | |
representative, the person or his representative may by notice require the | |
Commissioners to review— | |
(a) their decision that the person is liable to a penalty under section 25 or | |
26, or | 40 |
(b) their decision as to the amount of the liability. | |
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(3) Where the Commissioners give a notice under section 28 to a body corporate | |
and to a relevant officer— | |
(a) subsection (2) does not apply to any demand notice given in respect of | |
the liability of either of them to a penalty under this Part in respect of | |
the conduct in question, but | 5 |
(b) subsections (4) and (5) have effect instead in relation to any such | |
demand notice. | |
(4) Where the Commissioners give a demand notice to the relevant officer or his | |
representative for a penalty which corresponds to the portion of the basic | |
penalty specified in the notice under section 28, the relevant officer or his | 10 |
representative may by notice require the Commissioners to review— | |
(a) their decision that the conduct of the body corporate referred to in | |
section 28(1)(b) is, in whole or in part, attributable to the relevant | |
officer’s dishonesty, or | |
(b) their decision as to the portion of the basic penalty which the | 15 |
Commissioners are seeking to recover from the relevant officer or his | |
representative. | |
(5) Where the Commissioners give a demand notice to the body corporate or its | |
representative for so much of the basic penalty as is not recoverable from the | |
relevant officer by virtue of section 28(3), the body corporate or its | 20 |
representative may by notice require the Commissioners to review— | |
(a) their decision that the body corporate is liable to a penalty under | |
section 25, or | |
(b) their decision as to amount of the basic penalty as if it were the amount | |
specified in the demand notice. | 25 |
(6) A person may not under this section require a review of a decision under | |
section 35 (decision on review). | |
34 Time limit and right to further review | |
(1) The Commissioners are not required under section 33 to review any decision | |
unless the notice requiring the review is given before the end of the permitted | 30 |
period. | |
(2) For the purposes of this section the “permitted period” is the period of 45 days | |
beginning with the day on which the relevant notice is given. | |
(3) For the purposes of subsection (2) the “relevant notice” is— | |
(a) in the case of a review by virtue of subsection (1) of section 33, the notice | 35 |
mentioned in that subsection; or | |
(b) in any other case, the demand notice in question. | |
(4) Nothing in subsection (1) prevents the Commissioners from agreeing on | |
request to review a decision in a case where the notice required by that | |
subsection is not given within the permitted period. | 40 |
(5) A person may give notice under section 33 requiring a decision to be reviewed | |
a second or subsequent time only if— | |
(a) the grounds on which he requires the further review are that the | |
Commissioners did not, on any previous review, have the opportunity | |
to consider any particular facts or matters; and | 45 |
(b) he does not, on the further review, require the Commissioners to | |
consider any facts or matters which were considered on a previous | |
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