A number of wholesalers who claim they were cast into “limbo” by the new Alcohol Wholesaler Registration Scheme (AWRS) have been granted permission to continue trading pending a tribunal into their working practices.
The AWRS came into effect on April 1, making it illegal for anyone to trade in alcohol if they hadn’t been ratified under the HMRC created initiative.
Eight wholesalers via law firm Alexander Whyatt have since taken HMRC to court after they failed to gain approval under the scheme, and were barred from trading while they await the appeal tribunal.
The group of wholesalers claims they have been “forced out of business” while they wait for the appeal to take place.
The AWRS is the most recent move made by the government to crack down on excise evasion, estimated to cost the Treasury up to £1 billion every year.
It is also the most pertinent to the UK trade, affecting both wholesalers and retailers.
By law, wholesalers must make sure they comply with the responsible trading criteria set by the scheme, and the onus has also been passed to retailers to ensure that wholesalers they trade with have a certified AWRS URN.
Wholesalers were given until March 31, 2017, to submit their applications, with the scheme going live the next day, on April 1.
Today, HMRC confirmed to Harpers that they had been involved in “a small number of cases where traders whose applications for approval have been refused, are seeking to have the period during which they can continue to trade extended.”
According to HMRC, alcohol fraud cost the UK £1.8bn in 2014/5, mostly fuelled by alcohol being introduced with no duty paid on it into legitimate supply chains.
Changes have been made to the scheme which launched for the first time earlier this month, including giving wholesalers ways to dispose off illegal stock.
“Where applications from established businesses who applied on time have been refused, in most cases HMRC has allowed time for stock to be disposed of, usually between 30 and 45 days.
“In March, we changed our guidance to make sure that retailers buying stock sold off in this way would not be penalised.”
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