Tuesday, 11 June 2013
Department of Finance
I am sure the Deputy will appreciate that estimating the extent of any illegal activity and the associated cost to the exchequer is inherently problematic. I am advised by the Revenue Commissioners that while there is no reliable estimate of the scale of the problem, they recognize that it represents a significant threat to the exchequer and to the legitimate trade. Revenue collects some €1.1 billion annually in excise duty from road diesel so the potential for loss of tax revenue from fuel laundering is very significant. For these reasons, Revenue has made action against fuel laundering one of its priorities and is implementing a comprehensive strategy to tackle the problem. This strategy includes the following elements:
- The licensing regime for auto fuel traders was strengthened with effect from September 2011 to limit the ability of the fuel criminals to get laundered fuel onto the market;
- A new licensing regime was introduced for marked fuel traders in October 2012, which is designed to limit the ability of criminals to source marked fuel for laundering;
- New requirements in relation to fuel traders' records of stock movements and fuel deliveries were introduced to ensure data are available to assist in supply chain analysis;
- Following a significant investment in the required IT systems, new supply chain controls were introduced from January 2013. These controls require all licensed fuel traders, whether dealing in road fuel or marked fuel, to make monthly electronic returns to Revenue of their fuel transactions. Revenue is using this data to identify suspicious or anomalous transactions and patterns of distribution that will support follow-up enforcement action where necessary;
- An intensified targeting, in co-operation with other law enforcement agencies on both sides of the border, of enforcement action against suspected fuel laundering operations; and
- Following discussions with HM Revenue & Customs in the UK on regulatory measures to tackle the problem, the two administrations signed a Memorandum of Understanding in May 2012 on a joint approach to finding a more effective marker for use in both jurisdictions and an Invitation to Make Submissions was published in June 2012. By the deadline in November 2012, 12 submissions had been received and these are currently being evaluated.
Revenue's enforcement strategy in the fuel sector has already yielded significant results. In the past two years 96 filling stations were closed for breaches of the licensing regulations. Since the beginning of 2010, 29 oil laundries were detected and closed and 13 oil tankers and 60 vehicles were seized. In the same period over 2.5 million litres of fuel were seized.