Finance Bill

House of Commons

Session 2002 - 03
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Finance Bill

Finance Bill
Part 1 — Excise duties
1

A
Bill
[AS AMENDED IN THE COMMITTEE AND IN STANDING COMMITTEE A]
To
Grant certain duties, to alter other duties, and to amend the law relating to the
National Debt and the Public Revenue, and to make further provision in
connection with finance.
Most Gracious Sovereign
WE, Your Majesty’s most dutiful and loyal subjects, the Commons of the
United Kingdom in Parliament assembled, towards raising the necessary
supplies to defray Your Majesty’s public expenses, and making an addition to the
public revenue, have freely and voluntarily resolved to give and to grant unto Your
Majesty the several duties hereinafter mentioned; and do therefore most humbly
beseech Your Majesty that it may be enacted, and be it enacted by the Queen’s most
Excellent Majesty, by and with the advice and consent of the Lords Spiritual and
Temporal, and Commons, in this present Parliament assembled, and by the authority
of the same, as follows:—
Part 1
Excise duties
Tobacco products duty
1
Rates of tobacco products duty
(1)
For the Table of rates of duty in Schedule 1 to the Tobacco Products Duty Act
5
1979 (c. 7) substitute—

Bill 127 – I 53/3

Finance Bill
Part 1 — Excise duties
2

Table

1.  Cigarettes
An amount equal to 22 per cent of

the retail price plus £99.80 per

thousand cigarettes.

2.  Cigars
£145.35 per kilogram.

5

3.  Hand-rolling tobacco
£104.47 per kilogram.

4.  Other smoking tobacco
£63.90 per kilogram.

and chewing tobacco

(2)
This section shall be deemed to have come into force at 6 o’clock in the evening
of 17th March 2004.
10
Alcoholic liquor duties
2
Rate of duty on beer
(1)
In section 36(1AA)(a) of the Alcoholic Liquor Duties Act 1979 (c. 4) (rate of duty
on beer) for “£12.22” substitute “£12.59”.
(2)
This section shall be deemed to have come into force at midnight on 21st March
15
2004.
3
Rates of duty on wine and made-wine
(1)
For Part 1 of the Table of rates of duty in Schedule 1 to the Alcoholic Liquor
Duties Act 1979 (rates of duty on wine and made-wine) substitute—

20
Part 1
Wine and made-wine of a strength not exceeding 22 per cent

Description of wine or made-wine
Rates of duty per

hectolitre

£

25

Wine or made-wine of a strength not
50.38

exceeding 4 per cent

Wine or made-wine of a strength exceeding
69.27

4 per cent but not exceeding 5.5 per cent

Wine or made-wine of a strength exceeding
163.47

30

5.5 per cent but not exceeding 15 per cent

and not sparkling

Sparkling wine or sparkling made-wine of a
166.70

strength exceeding 5.5 per cent but less

than 8.5 per cent

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Finance Bill
Part 1 — Excise duties
3

Description of wine or made-wine
Rates of duty per

hectolitre

Sparkling wine or sparkling made-wine of a
220.54

strength of 8.5 per cent or of a strength

exceeding 8.5 per cent but not exceeding

5

15 per cent

Wine or made-wine of a strength exceeding
217.95

15 per cent but not exceeding 22 per cent

(2)
This section shall be deemed to have come into force at midnight on 21st March
2004.
10
4
Duty stamps for spirits etc
(1)
At the beginning of Part 6 of the Alcoholic Liquor Duties Act 1979 (c. 4)
(general control provisions) under the heading “Sale of dutiable alcoholic liquors”
insert—
“64A
Retail containers of certain alcoholic liquors to be stamped
15
Schedule 2A to this Act (duty stamps) has effect.”.
(2)
Before Schedule 3 to that Act insert the Schedule 2A set out in Schedule 1 to this
Act.
(3)
In section 12(2) of the Finance Act 1994 (c. 9) (defaults engaging
Commissioners’ power to assess excise duty to the best of their judgement)
20
after paragraph (c) insert—
“(ca)
any failure by any person to comply with a requirement to
which he is made subject by or under Schedule 2A to the
Alcoholic Liquor Duties Act 1979 (duty stamps);”.
(4)
In section 14(1) of that Act (reviewable decisions) after paragraph (bc) insert—
25
“(bd)
any decision by the Commissioners as to whether or not any
person is entitled to any repayment or credit by virtue of
regulations under paragraph 4(2)(g) of Schedule 2A to the
Alcoholic Liquor Duties Act 1979 (duty stamps), or the amount
of the repayment or credit to which any person is so entitled;
30
(be)
any decision by the Commissioners made by virtue of
regulations under paragraph 4(2)(h) of that Schedule that some
or all of a payment made, or security provided, is forfeit, or the
amount which is so forfeit;”.
(5)
The amendments made by this section have effect in relation to retail
35
containers containing alcoholic liquor if the excise duty point for the alcoholic
liquor falls on or after such day as the Treasury may by order made by
statutory instrument appoint.
(6)
An order under subsection (5) may contain such supplemental and transitional
provision and savings as the Treasury think fit in connection with the coming
40
into effect of those amendments.
(7)
In subsection (5) “excise duty point” has the meaning given by section 1 of the
Finance (No. 2) Act 1992 (c. 48).

Finance Bill
Part 1 — Excise duties
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Hydrocarbon oil etc duties
5
Rates
(1)
In section 6 of the Hydrocarbon Oil Duties Act 1979 (c. 5) (hydrocarbon oil:
rates of duty)—
(a)
in subsection (1A)(a) (ultra low sulphur petrol) for “£0.4710” substitute
5
“£0.4902”,
(b)
in subsection (1A)(b) (other light oil) for “£0.5620” substitute “£0.5790”,
(c)
in subsection (1A)(c) (ultra low sulphur diesel) for “£0.4710” substitute
“£0.4902”, and
(d)
in subsection (1A)(d) (other heavy oil) for “£0.5327” substitute
10
“£0.5487”.
(2)
In section 6AA(3) of that Act (biodiesel: rate of duty) for “£0.2710” substitute
“£0.2852”.
(3)
In section 11(1) of that Act (rebate on heavy oil)—
(a)
in paragraph (a) (fuel oil) for “£0.0382” substitute “£0.0624”,
15
(b)
in paragraph (b) (gas oil: general) for “£0.0422” substitute “£0.0664”,
and
(c)
in paragraph (ba) (ultra low sulphur diesel) for “£0.0422” substitute
“£0.0664”.
(4)
In section 13A(1) of that Act (rebate on unleaded petrol) for “£0.0601”
20
substitute “£0.0620”.
(5)
In section 14(1) of that Act (rebate on light oil for use as furnace fuel) for
“£0.0382” substitute “£0.0624”.
(6)
This section shall come into force on 1st September 2004.
6
Road fuel gas
25
(1)
At the end of section 5 of the Hydrocarbon Oil Duties Act 1979 (road fuel gas)
(which becomes subsection (1)) add—
“(2)
In this Act “natural road fuel gas” is road fuel gas with a methane
content of not less than 80%.”
(2)
For section 8(3) of that Act (rate of duty on road fuel gas) substitute—
30
“(3)
The rate of the duty under this section shall be—
(a)
in the case of natural road fuel gas, £0.1110 a kilogram, and
(b)
in any other case, £0.1303 a kilogram.”
(3)
After section 21(2) of that Act (regulations) insert—
“(2A)
In the case of regulations made for the purposes mentioned in
35
subsection (1)(c) above, different regulations may be made for different
classes of road fuel gas.”
(4)
This section shall come into force on 1st September 2004.
7
Sulphur-free fuel
(1)
For section 1(3A) and (3B) of the Hydrocarbon Oil Duties Act 1979 (c. 5)
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Finance Bill
Part 1 — Excise duties
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(descriptions of hydrocarbon oil: ultra low sulphur petrol and unleaded petrol)
substitute—
“(3A)
“Ultra low sulphur petrol” means unleaded petrol—
(a)
the sulphur content of which does not exceed 0.005 per cent. by
weight,
5
(b)
the aromatics content of which does not exceed 35 per cent. by
volume, and
(c)
which is not sulphur-free petrol.
(3B)
“Sulphur-free petrol” means unleaded petrol the sulphur content of
which does not exceed 0.001 per cent. by weight (or is nil).
10
(3C)
“Unleaded petrol” means petrol that contains not more than 0.013
grams of lead per litre of petrol; and petrol is “leaded petrol” if it is not
unleaded petrol.”
(2)
For section 1(6) of that Act (ultra low sulphur diesel) substitute—
“(6)
“Ultra low sulphur diesel” means gas oil—
15
(a)
the sulphur content of which does not exceed 0.005 per cent. by
weight,
(b)
the density of which does not exceed 835 kilograms per cubic
metre at a temperature of 15oC,
(c)
of which not less than 95 per cent. by volume distils at a
20
temperature not exceeding 345oC, and
(d)
which is not sulphur-free diesel.
(7)
“Sulphur-free diesel” means gas oil the sulphur content of which does
not exceed 0.001 per cent. by weight (or is nil).”
(3)
In section 1(1) of that Act for “Subsections (2) to (6)” substitute “Subsections (2)
25
to (7)”.
(4)
For section 2A(1) of that Act (power to amend definitions) substitute—
“(1)
The Treasury may by order made by statutory instrument amend the
definition for the purposes of this Act of—
(a)
sulphur-free diesel;
30
(b)
sulphur-free petrol;
(c)
ultra low sulphur diesel;
(d)
ultra low sulphur petrol;
(e)
unleaded petrol and leaded petrol.”
(5)
In section 6(1A) of that Act (rates of duty)—
35
(a)
after paragraph (a) insert—
“(aa)
£0.4852 a litre in the case of sulphur-free petrol;”,
(b)
in paragraph (b) after “other than ultra low sulphur petrol” insert “and
sulphur-free petrol”,
(c)
after paragraph (c) insert—
40
“(ca)
£0.4852 a litre in the case of sulphur-free diesel;”, and
(d)
in paragraph (d) after “other than ultra low sulphur diesel” insert “and
sulphur-free diesel”.
(6)
In section 13AA(6) of that Act (restrictions on use of rebated kerosene) after
“which is not ultra low sulphur diesel” insert “or sulphur-free diesel”.
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Finance Bill
Part 1 — Excise duties
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(7)
In section 13A(1) of that Act (rebate on unleaded petrol) after “, other than ultra
low sulphur petrol” insert “and sulphur-free petrol”.
(8)
In section 27 of that Act (interpretation)—
(a)
after the definition of “road vehicle” insert—

““sulphur-free diesel” has the meaning given by section 1(7)
5
above;

“sulphur-free petrol” has the meaning given by section 1(3B)
above;”, and
(b)
in the definition of “unleaded petrol” and “leaded petrol” for “section
1(3B) above.” substitute “section 1(3C) above.”
10
(9)
This section shall come into force on 1st September 2004.
8
Definition of “fuel oil”
Before section 2A(2) of the Hydrocarbon Oil Duties Act 1979 (c. 5) (power to
amend definitions) insert—
“(1C)
The Treasury may by order made by statutory instrument amend the
15
definition for the purposes of section 11 of “fuel oil”.”
9
Mixing of rebated oil
(1)
For section 20AAA of the Hydrocarbon Oil Duties Act 1979 (mixing of rebated
oil) substitute—
“20AAA
    Mixing of rebated oil
20
(1)
A duty of excise shall be charged on a mixture which is—
(a)
produced by mixing fully rebated heavy oil with heavy oil
which is not fully rebated, and
(b)
supplied for use as fuel for any engine, motor or other
machinery.
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(2)
A duty of excise shall be charged on a mixture which is—
(a)
produced by mixing partially rebated heavy oil with heavy oil
which is not partially rebated, and
(b)
supplied for use as fuel for any engine, motor or other
machinery;
30

but a mixture on which duty is charged under subsection (1) shall not
be charged under this subsection.
(3)
A duty of excise shall be charged on a mixture which is produced by
mixing—
(a)
fully or partially rebated heavy oil, with
35
(b)
biodiesel or a substance containing biodiesel.
(4)
The rate of duty on a mixture under subsection (1) or (2) shall be—
(a)
in the case of a mixture supplied for use as fuel for a road
vehicle, the rate of duty specified in section 6(1A)(d) (general
rate for heavy oil), and
40
(b)
in any other case, equivalent to the rate of rebate specified in
section 11(1)(b) (general rate for gas oil).

Finance Bill
Part 1 — Excise duties
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(5)
The rate of duty on a mixture under subsection (3) shall be the rate of
duty specified in section 6(1A)(d).
(6)
For the purposes of this section—
(a)
oil is fully rebated if a rebate has been allowed in respect of it
under section 11(1)(c) (general rebate for heavy oil),
5
(b)
oil is partially rebated if a rebate has been allowed in respect of
it under any other provision of section 11 or under section
13AA, and
(c)
a reference to mixing is a reference to non-approved mixing
(within the meaning given by section 20A(5)).
10
(7)
The person liable to pay duty charged under this section on supply or
production of a mixture is the person supplying or producing the
mixture.
(8)
Where duty under a provision of this Act has been paid on an
ingredient of a mixture, the duty charged under this section shall be
15
reduced by the amount of any duty that the Commissioners are
satisfied has been paid on the ingredient (but not to a negative amount).
(9)
The Commissioners may exempt a person from liability to pay duty
under any provision of this Act in respect of production or supply of a
mixture of a kind described in subsection (1)(a), (2)(a) or (3) if satisfied
20
that—
(a)
the liability was incurred accidentally, and
(b)
in the circumstances the person should be exempted.”
(2)
In section 20AAB of that Act (mixing of rebated oil: supplementary)—
(a)
for subsections (1) and (2) substitute—
25
“(1)
A person who supplies or produces a mixture on which duty is
charged under section 20AAA above must notify the
Commissioners of the supply or production—
(a)
in advance, or
(b)
within the period of seven days beginning with the date
30
of supply or production.”, and
(b)
in subsection (3) omit “or (2)”.
(3)
Schedule 2A to that Act shall cease to have effect.
(4)
This section—
(a)
in so far as it imposes or relates to the charge specified in section
35
20AAA(1) or (2) of that Act (as substituted by subsection (1) above),
shall have effect in relation to anything supplied on or after the date on
which this Act is passed,
(b)
in so far as it imposes or relates to the charge specified in section
20AAA(3) of that Act (as substituted by subsection (1) above), shall
40
have effect in relation to anything produced on or after the date on
which this Act is passed, and
(c)
in so far as it causes sections 20AAA and 20AAB(1) and (2) of, and
Schedule 2A to, that Act to cease to have effect in their present form,
shall come into force on the day on which this Act is passed.
45
(5)
But no duty shall be charged on the supply of a mixture under section
20AAA(1) or (2) of that Act (as substituted by subsection (1) above) if duty was