S.I. 2007/3307: memorandum from Her Majesty's Revenue and Customs

Biofuels and Hydrocarbon Oil Duties (Miscellaneous Amendments) Regulations 2007 (S.I. 2007/3307)

1. This memorandum has been prepared by the Commissioners for Her Majesty's Revenue and Customs in response to the Joint Committee's letter of 12 December 2007 requesting a memorandum on the following point:

New regulation 19A(5) of the Biofuels and Other Fuel Substitutes (Payment of Excise Duties etc) Regulations 2004 (substituted by regulation 4(3) of these Regulations) applies regulation 19(2) to (6) in its latest form to large producers in an adjusted manner. Explain why regulation 19A(5) does not include a further adjustment that would treat the references to regulation 19(1A) in regulation 19(4) and (6)(a) as references to regulation 19A(4).

2. Regulation 19(1A) imposes a requirement on producers, other than large producers, to make a return and pay duty in respect of biofuels for which an excise duty point arises. The return and the payment must be made by the fifteenth date of the quarter following the quarter in which the excise duty point arose. Regulation 19(4) provides that where the fifteenth day falls on a day that is not a business day the requirements of regulation 19(1A) must be complied with no later than the last business day before the fifteenth day.

3. Regulation 19A(4) imposes parallel accounting and payment requirements on large producers. In their case the return and payment must be made by the fifteenth day of the month following the month in which a duty point arose.

4. Regulation 19A(5) provides for the ancillary provisions relating to returns and payments in regulation 19(2) to 19(6) to apply to large producers "as they apply" to producers. It is therefore clear that these provisions, in their application to large producers, are analogous to those applicable to producers. Given that regulations 19(1A) and 19A(4) create parallel requirements, the Department contends that in the context of regulation 19A(5), the references in question to requirements of paragraph (1A) must be understood as references to the corresponding requirements of regulation 19A(4). The Department contends that this is a sensible construction of regulation 19A(5), and therefore considers that, strictly, it is unnecessary for regulations 19(4) or 19(6)(a), in their application to large producers, to be adjusted so that the references to regulation 19(1A) are made references to regulation 19A(4).

5. Nevertheless the Department recognises that it would be expedient to make the adjustments and undertakes to do so on the next suitable occasion.

Commissioners for Her Majesty's Revenue and Customs

18 December 2007