Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of tobacco manufacturers’ ability to control their supply chain to prevent contraband tobacco coming into the UK.

In 2006, Parliament introduced stringent rules requiring all UK tobacco manufacturers to control their supply chains. These rules required them to take steps to avoid supplying cigarettes and hand rolling tobacco to persons who are likely to smuggle them into the UK or resupply them to other persons who are likely to do the same.

Tobacco manufacturers can face penalties of up to £5m for failing to comply with the rules.

HM Revenue & Customs (HMRC) robustly challenge tobacco manufacturers’ supply chain policies and procedures to ensure their continued compliance with the rules. This has involved ongoing contact and regular meetings between HMRC’s Large Business Team and manufacturers since the legislation was introduced.

One aspect of this ongoing contact is the requirement that manufacturers inspect seizures of over 100,000 cigarettes or 50kg of hand rolling tobacco and provide a summary of how those goods, if confirmed genuine, got in to the hands of smugglers. Large Business review and challenge these summaries to ensure manufacturers have taken appropriate action, in line with their own published supply chain policies.

Due to taxpayer confidentiality it is not possible to provide comment on the progress of HMRC’s discussions with individual businesses about their supply chain controls.