H.M. TREASURY Notes on Clauses

CLAUSE 10: DRAWBACK OF DUTY ON SHIPMENT AS STORES, ETC.

1. This clause extends the power of the Commissioners of Customs and Excise to make regulations allowing all suppliers of excise goods for use as stores for ships and aircraft to make excise drawback claims (C&E 7).

2. Schedule 20 Part 1 (2) repeals section 132 of the Customs and Excise Management Act 1979.

DETAILS OF THE CLAUSE

3. Subsection (1) adds to section 2 of the Finance (No. 2) Act 1992, the power for the Commissioners of Customs and Excise to make regulations allowing excise drawback claims (repayments of duty) to be made by suppliers of excise goods for use as stores on ships and aircraft and to excise warehouses for use as stores on ships and aircraft.

4. Subsection (2) replaces "'goods' has the same meaning" in section 2, subsection 5 of the above section by with the definition, "'excise warehouse', 'goods', 'shipment', 'stores' and 'warehousing' have the same meanings". Thus section 2(5) of the Finance (No.2) Act 1992 now provides that "'excise warehouse', 'goods', 'shipment', 'stores' and 'warehousing' have the same meanings as in the Customs and Excise Management Act 1979."

5. Subsection (3) and Schedule 20 Part 1(1) repeal section 132 of the Customs and Excise Management Act 1979, which provides for the extension of drawback provisions in that Act to shipment and warehousing for use as stores in ships and aircraft.

6. Subsection (4) states that subsection (3) shall come into effect on a day appointed by the Commissioners of Customs and Excise, in a statutory instrument.

BACKGROUND

7. The Excise Goods (Drawback) Regulations 1995 currently do not include the right to claim drawback on supplies as stores to ships and aircraft. Previously, repayments of duty could only be made for supplies of beer and oil and oil-based products. This clause will enable the Commissioners of Customs and Excise to amend these Regulations, or make new ones, to allow drawback claims on all eligible excise goods.

8. This change is part of the ongoing streamlining of legislation providing for repayment of excise duty arising, for example, when excise goods are exported or destroyed.

9. The change will make section 132 of the Customs and Excise Management Act redundant. Consequently this section will be repealed when new regulations are brought into effect.