Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

On behalf of my colleague, Deputy Michael McGrath, I welcome the introduction of this Bill. It is primarily a technical Bill, but it gives us a chance to discuss the issues and pay tribute to the work of the Customs and Excise service.

Any legislation dating back to 1876 is probably in need of review. However, what has been constant since then has been the dedication and courage of the members of the service around the country in doing their job, often in very difficult circumstances. These officers do not receive the attention other branches of the services do. We never see a drama series about customs or any fly on the wall documentaries. However, that is not to say the officers are not doing a fantastic job. We support this legislation.

Some of the challenges facing the service were never envisaged in 1876 or even in the most recent legislation, particularly in regard to what is covered by section 42 - customs duty collected in one state on goods imported into another. I expect we will see significant growth in this area in coming years. The Minister is aware there is a difficulty currently in regard to online purchases which are not subject to the sales tax or VAT a person buying goods in a shop must pay. This makes for an uneven playing pitch for retailers and we end with a situation where the traditional bricks and mortar retailers operate versus those online and those outside the jurisdiction. Is there some potential to level that playing pitch in section 42?

The issue of customs duties and fuel presents a particular challenge. I wish to pay tribute to Customs and Excise, the Garda, the relevant local authorities and the Minister's officials in regard to the progress made on the issue of diesel laundering in the past few months. However, the progress on diesel laundering puts into stark contrast the lack of progress, a kind of "do not know where to go" response, on the issue of petrol stretching. I wish to acknowledge the work the Minister of State, Deputy Simon Harris, has done on this. However, there is enormous frustration, particularly across my constituency where hundreds of people have been affected, that the response of the State on petrol stretching has not led anywhere and has not provided any answers.

I know this is a difficult issue to tackle, but the people affected are ordinary people who went about their business and filled their cars with petrol from legitimate retailers and as a result of that basic transaction, their engines were damaged. Sometimes two or three cars belonging to one family were affected. In most cases, insurance companies have paid out for repairs, but this has affected "no claims" bonuses and many bonuses were lost, leaving people hundreds of euro out of pocket. In the case of those with only third party insurance, the damage was not covered and people are thousands of euro out of pocket. When people report the issue to the Garda, gardaí say it is being investigated and Customs and Excise says the same. However, there is no sense that they are anywhere near getting to the bottom of the issue, which is a frustration for everybody.

I understand it is difficult to investigate this issue because the damage was done long before its effect was seen in cars. However, when consumers pay fuel duty - almost 60% on petrol - and pay a levy on their insurance policy towards Government protection, they expect that when something beyond their control happens, there will be some sort of compensation. While I acknowledge the significant work that has been done by the Minister of State, will the Minister ensure that the Department examines this issue? These people were innocent victims of something which I now believe was not criminal. Somebody messed up somewhere along the line and hundreds of families have been affected. Some families in rural areas have two cars off the road and public transport is not an option. I ask for particular attention to be given to this. In the context of diesel laundering, we have seen success can be achieved and in the past number of months have noticed an increase in the level of detection. In County Monaghan, a plant laundering 20 million litres a year was uncovered. This took years of work, surveillance activity, investigation work and other work we are not even aware of.

The Minister has stated previously that there are approximately 2,000 staff in Revenue involved in enforcement activities. We need to ensure they are up to date with all the technology available and that they have the capability and access to modern technology on a par with the people and organisations they are tracking. We must ensure Revenue and Customs and Excise are one step ahead of those involved in diesel or fuel laundering or in illegal cigarette sales for the purpose of illicit earnings.

When the issue of fines was discussed in the context of the Finance Bill, Deputy Michael McGrath suggested we needed to increase the fines for laundering and smuggling of fuel considerably. This would send an important signal that we will not tolerate this type of activity within our country and that those caught will pay a heavy price. I understand it is now considerably more difficult - I cannot say it is impossible - to remove the dye from fuel. We need to look again at the issue of marked diesel for agricultural and industrial use and at replacing it with a rebate system. This would further reduce any incentive to buy this cheap fuel.

There is much consideration given to the issue of cigarette smuggling. EU estimates suggest that the illegal tobacco trade costs the Union €10 billion a year, at a time when national budgets are stretched beyond breaking point. A report by Northern Ireland's organised crime task force showed that paramilitaries work with international smugglers to import both counterfeit cigarettes and so- called "illicit whites". These are cigarettes made in legitimate factories overseas but then smuggled into the European Union without paying the appropriate duty. A report by Irish customs shows 76% of seized cigarettes in 2012 were "illicit whites", up from 46% in 2011. This gives us some indication of the size of the problem.

Counterfeit cigarettes are typically manufactured in China and other Asian countries and illegally shipped to Europe. Apart from the loss of revenue, there are other issues of concern, such as the content and the abnormally high levels of cancer-causing chemicals in them. I welcome the fact there has been increased co-operation between EU and Chinese customs to cut the scale of this trade. However, much more needs to be done in terms of building awareness of the content of the cigarettes and educating people on the fact that these cheap cigarettes are dangerous to their health.

More work needs to be done on educating consumers on their rights, particularly in regard to purchasing goods from overseas retailers and the excise duties they face. I said earlier we need to level the playing pitch. Many websites do not tell customers the full cost of the goods they are about to buy, particularly the cost when customs duty is added.

As I understand it if the value of the purchase plus shipping from a website outside the EU is €22 or more, then Irish VAT must be paid. Someone buying goods valued at €150 or more is liable to pay import charges. That needs to be more widely publicised so that people are aware of the full cost when making purchasing decisions rather than having to hand over more money to the import agent when the gift arrives.

I welcome the Bill which gives us a chance to discuss the customs service and the very brave work the men and women of that service do every day across this island. They have been faced with huge challenges over the decades, particularly during the Troubles. Members of that service have put themselves at risk to serve the State for which they deserve the respect and support of the House. I welcome the legislation.

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