Billions lost through tobacco scams
The government is losing up to £3.5bn a year through tobacco smuggling, part of an estimated £7.3bn lost through VAT fraud revealed in Customs & Excise's latest appropriation accounts.
The National Audit Office’s review of the accounts said Customs should improve the way it tackled tobacco fraud by making more effective use of scanner technology at ports and publicising more widely its success rates.
The NAO also said Customs could make better use of its VAT registration procedures to identify potential fraud, particularly in the area of ‘missing trader’ fraud.
Edward Leigh, chairman of the Public Accounts Committee, said: ‘The department must get a better grip in key areas.’
He added: ‘It is regrettable we have had to wait for this report from the National Audit Office before we could see clearly the extent of indirect tax fraud estimated so far.’