SUMMARY

  The British International Freight Association is grateful for the opportunity to make a written submission to the Treasury Sub-Committee Customs & Excise Inquiry. Our comments reflect the views of our Members that greater use can be made of freight forwarders in undertaking the completion of Customs' work which can be controlled on a post audit basis.

  1.  The British International Freight Association (BIFA) is the primary representational body of the international freight services industry. The forwarding community handles 50 per cent by value of the United Kingdom's non-bulk external trade and our Members handle 85 per cent of that figure. BIFA is a non-profit making organisation funded by subscription. Apart from a small full time secretariat it is controlled by BIFA Members who give up their time on a voluntary basis to establish policy and make decisions on behalf of the industry.

  2.  The freight forwarding industry is keen to support Customs in encouraging and enforcing compliance across the range of its responsibilities and in tackling the shadow economy. There has been a change of emphasis in the last few years to simplified procedures for Customs clearance with audit based controls. There has been a successful take up of this scheme however there is scope for further attainment with more involvement by the freight forwarding community. Customs should consider greater rewards for freight forwarders in enhanced compliance. Freight forwarders often undertake a substantial part of the administration in the movement of goods and will sometimes run shipping departments for traders using implant staff. Staff reduction or other service cuts could impact the trade and consideration should be given to authorisation of freight forwarders to undertake some of the tasks performed by Customs. This principle is detailed in Customs in the 21st Century—The Customs Long Term Freight Policy published in October 1997 under Section 5—Issues, item 5.1.4 Third parties. This subject is also detailed in the Kyoto Convention chapter 8, Relationship between the Customs and third parties.

  3.  We wish to comment on the work of Customs and the impact of non-compliance on compliant businesses. Our Members feel there is a definite penalty to compliant businesses caused by the Customs attempt to control non-compliant movements. A specific example is the enforcement of the Movement and Holding Directive. As part of their role Excise Enforcement Officers stop vehicles for checking. If an error is found on the AAD (the Excise accompanying document) both the vehicle and load are seized. The vast majority of these movements are correctly controlled (for example destined to be a proper tax warehouse) however to obtain release a payment of £250 has to be made for both the vehicle and the load.

  4.  It is the view of BIFA that a merged department of both Customs and the Inland Revenue could lead to a loss of experienced staff in the provision of advice in Customs compliance issues. Furthermore focus could be shifted from the current emphasis on simplification in Customs procedures and post audit controls. Another area of concern is that whenever a merger takes place there is a lack of external focus which is detrimental to the customers and stakeholders in any organisation.

8 October 1999