Question to the HM Treasury:

To ask Her Majesty's Government, further to the Written Answers by Baroness Penn on 7 February (HL5670 and HL5671), what assessment they have made of the impact of the Protocol on Ireland/Northern Ireland on the levels of smuggling of red diesel across the border between Northern Ireland and the Republic of Ireland.

The Government has not made such an assessment.

HM Revenue and Customs (HMRC) produces an annual estimate of the tax gap across all taxes and duties administered by HMRC. This is the difference between the amount of tax that should in theory be collected, and what is actually paid. In HMRC’s latest report, the Northern Ireland diesel illicit market share is estimated at 4% in 2019 to 2020. This resulted in an estimated loss of £20 million in duty and a further £10 million in VAT, giving a total loss of £30 million. These estimates cannot be disaggregated by type of fraud such as smuggling.

HMRC continues to work in partnership with other enforcement agencies including the Revenue Commissioners in Ireland to tackle this risk. This extensive multi-agency, cross border cooperation is a key element of HMRC’s operational response and commitment to tackling fuel duty fraud.