Raw tobacco is not subject to excise duty. HM Revenue and Customs (HMRC) identified a significant risk to revenue after an increase in raw tobacco imports and seizures. Proposals were made to introduce additional controls on raw tobacco.
The introduction of the Raw Tobacco Approval Scheme (RTAS) is aimed at businesses and individuals, importing or using raw tobacco for any purpose. The scheme will be backed up by seizure powers and penalties for breaches of approval requirements.
From 1 April 2017, businesses or individuals who intend to carry on any activity involving raw tobacco must hold an approval from HMRC, unless an exemption applies.
Purpose of the scheme
The Raw Tobacco Approval Scheme will aim to:
- reduce the risk of excise duty evasion
- prevent the illegal manufacture of tobacco products
- Control the movement of raw tobacco in the UK.
An approval scheme will tighten controls but provide legitimate users and dealers with a much less burdensome system to demonstrate legitimate use instead of having to provide assurances for each consignment. The scheme will enable HMRC and Border Force (BF) officers to identify and seize raw tobacco and carry out further checks where a risk is identified.
The Approval Process
HMRC will accept applications from businesses or individuals from 1 January 2017. Applications can be made in writing and there’s a Detailed Guide available on GOV.UK on how to apply and the information required: https://www.gov.uk/guidance/how-to-apply-for-the-raw-tobacco-approvalscheme.
Full details of the scheme are set out in Notice 2003 – Raw Tobacco Approval Scheme: https://www.gov.uk/government/publications/excise-notice-2003-tobacco-duty-the-raw-tobacco-approval-scheme.
If a business or individual intends to carry on a controlled activity from 1 April 2017 then applications for approval should be received by HMRC by the end of January 2017 to allow sufficient time for processing of the application.
Fit and proper criteria
HMRC will review the application and undertake checks to confirm the information provided is full and accurate and to verify that businesses and individuals are fit and proper for approval to the scheme.
From 1 April 2017, a person who carries on any activity involving raw tobacco without an approval, or fails to comply with the terms of an approval or exemption, is liable to penalties and the raw tobacco liable to seizure.
For general enquiries please phone our Helpline on
Telephone: 0300 200 3700.