If i buy 200-800 cigarettes cheaply from a UK or European based online store, am i in the wrong? Do i get taxed, and will the fags be confiscated?
Rod Serling Wed 21/06/06 11:06
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If the parcel is labeled up correctly you will have to pay the uk duty to receive it.
If the documents are falsified and found out, both yourself and the sender can end up with a massive fine.
If you are buying from, and the fags are being sent from the uk then there is nothing to worry about.
Cheapest option, quit.
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(2-part post):
A few figures for you:
Let's suppose that you buy 800 cigarettes of a brand which has a highest UK retail price of £5 per pack of 20. (The retail price is relevant because it's used to work out the excise duty). At UK prices these would, of course, cost you £200.
Let's further suppose that you purchase these cigarettes with an apparently massive 70% discount. (i.e. the purchase price is only £60).
When your goods arrive in the UK, HMRC will apply the first part of the excise duty. This is 22% of the maximum UK retail price. (i.e. £44). They then calculate the second part of the excise duty, at £9.98 per 100 cigarettes. (i.e. £79.84). The next stage is to calculate standard duty at 57.6% of the purchase price. (i.e. £34.56).
They now add everything together (including your £60 purchase price) to calculate the pre-VAT value of your cigarettes: £60 + £44 + £79.84 + £34.56 = £218.40. The next stage is to calculate VAT, at 17.5%, on this amount (i.e. £38.22). This brings their total charges to £44 + £79.84 + £34.56 + £38.22 = £196.92.
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To add insult to injury, there's also an £8 customs examination fee to pay. So, when the postman knocks on your door he'll demand payment of £204.62 (which is slightly more than you could have bought the cigarettes for at your local shop).
So, by the time you've added 'postage and packing' charges into the equation, your 'cheap' cigarettes will cost you about £70 more than buying them locally.
Additionally, you should be aware of this quote from the HMRC website:
"Some unscrupulous overseas suppliers openly advertise on the internet, or on their web-sites that they will deliberately either misdescribe items or underdeclare their value in order to evade customs charges that are legally due on importation. You should be aware that although the foreign sender may have completed the customs declaration form on the parcel you are regarded (in law) as the importer of the goods and responsible for the information on the declaration, and any customs charges that may be due. This means that if you purchase goods from these suppliers and the declaration is found to be false or misleading you may be liable to financial penalties or criminal prosecution. Furthermore the goods themselves will be liable to forfeiture. It is in your own interests to ensure Customs declarations are completed properly."
Chris
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