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National Audit Office report: HM Customs and Excise: Regulating Freight Imports from Outside the European Community

HM Customs and Excise: Regulating Freight Imports from Outside the European Community

"Customs have a difficult job to do in ensuring that the revenue is collected on imports and statutory requirements are met but without unduly inconveniencing importers. My report shows the Department could make their checks more effective and can improve the service they provide to importers still further."

"Customs have a difficult job to do in ensuring that the revenue is collected on imports and statutory requirements are met but without unduly inconveniencing importers. My report shows the Department could make their checks more effective and can improve the service they provide to importers still further."

Sir John Bourn

 

An NAO report has praised HM Customs and Excise for its effective regulation of imports from outside the European Union. There is, however, scope for improvement.

According to the report to Parliament today by head of the NAO Sir John Bourn, Customs have adequate arrangements to ensure that importers pay the correct amount of duty and comply with a range of statutory requirements such as import quotas, without unduly inconveniencing importers. Improvements should be made though in the way that Customs measure their performance and identify the risks to revenue.

The main findings and recommendations in the report were as follows.

  • Customs’ staff have based their decisions on which declarations to check on their previous experience: this may have had the consequence that certain types of imports were never checked as staff concentrated on those groups of declarations that had been incorrect in the past. For example, Customs’ local offices should have a plan in place to identify and analyse any new risks to the revenue and test those risks. Customs need, therefore, to develop further their risk management systems to make their checks on declarations more effective.
  • In the past four years the value of underdeclarations detected by Customs increased by £364 million (from £131 million to £495 million) or over 275 per cent. The lack of suitable data means that it is not possible to determine whether these results were due to the success of Customs’ approach to checking declarations or to an overall increase in the value of errors made by importers or a combination of both of these. We recommend that Customs should focus more closely on their objective of securing compliance of importers to pay the correct amount of duty by using, for example, the results of their random sampling of declarations to set targets for increasing importers’ compliance.
  • Customs have exceeded, by a wide margin, their targets in their Charter Standards on releasing consignments selected for checking. Importers told us that they now rely on Customs clearing their consignments more quickly than the targets in their Charter Standards and that they would be inconvenienced if Customs did not continue to do so. Customs could therefore alter their Charter Standard targets to give greater certainty to importers on the time to be taken for handling imports.

 

Publication details:

ISBN: 0102789010 [Buy a hard copy of this report from TSO]

HC: 131 2000-2001

Published date: February 2, 2001