Customs takes on cigarette fraudsters

VAT fraud on these products costs the government £7.3bn annually.

The scale of the action was revealed in a Treasury response to a Commons Public Accounts Committee report calling on Customs to do more to assess the scale of this and other frauds hitting revenue from VAT, tobacco and alcohol.

Besides targeted investigations, an increased number of checks have been introduced to prevent fraudulent registration and enable earlier identification of fraudsters, the Treasury said.

The Treasury also revealed the Inland Revenue is extending its Taxpayer Filing Initiative to cover the payment of VAT as well as the filing of returns on time.

The Revenue said it has already succeeded in reversing a four-year decline in the proportion of VAT returns filed by January 2002.

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