It has been well documented of late that the amount of tobacco for personal consumption that is allowed to be brought into the country duty free has actually risen! The idea is that by giving the benefit of the doubt to day-trippers, the customs officers can concentrate on the real villains. Tell that to the already hard pushed tobacco retailer on our patch, who already has to work on small margins in a diminishing market! The Wine and Spirit Association (WSA) has entered the dispute urging a reduction on duty in the booze trade.
The WSA has urged the chancellor to cut duty considerably at the next budget. WSA director Quentin Rapport says:
The French government actually profits by £135 million from our shoppers! He pointed out that as we supposedly live in a single market it is ludicrous to penalise our businesses in this way. In Switzerland, around three years ago, duty was reduced by nearly half, and the result was a dramatic reduction in cross border shopping.
Spirit shopping abroad has been reduced from 41% market share to 24% - just imagine the benefit to our nation if the results were the same. The same picture is the same all over northern Europe, and Scandinavia in particular.
This year Norway cut duty by 15% on spirits and 5% on wine and beer; Sweden reduced the duty on wine by 19% last year because of cross-border shopping with Denmark; meanwhile Denmark is planning to reduce their tax further as a result of the cross-border shopping with Germany!
Whichever way you look at it, we are out of touch and business is being squeezed in the UK, whilst our European partners are laughing all the way to the bank.
We are probably not militant enough as a nation; I could not imagine the French putting up with this situation.
The answer is to slash taxes, and Mr Brown, listen to the Mr Brown who knows. Don't wait until the next budget, do it now!