Written answers

Tuesday, 3 February 2015

Department of Finance

Revenue Commissioners Investigations

Photo of David StantonDavid Stanton (Cork East, Fine Gael)
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277. To ask the Minister for Finance the actions being taken to detect the illegal use of green diesel; the number of detections in 2013 and 2014 of such illegal activity; the actions taken as a result of any such detection; and if he will make a statement on the matter. [4869/15]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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Diesel that is used in agricultural tractors and for certain other specified purposes is subject to a lower rate of excise duty and must contain prescribed markers, including a dye which gives it a green colouration, to distinguish it from diesel that may be used in motor vehicles. It is an offence, under section 102 (1) (b) (ii) of the Finance Act 1999, to use marked diesel in a motor vehicle and a person convicted of that offence is liable to a fine of €5,000.

I am advised by the Revenue Commissioners that they undertake action on an ongoing basis to detect the illegal use of marked diesel in motor vehicles, including, in particular, the stopping of vehicles and checking of their fuel. As a result of this action, 1,318 detections of the illegal use of marked fuel were made in 2013 and 1,111 in 2014.

The numbers of convictions that were obtained in 2013 and 2014 arising from detections of the illegal use of marked fuel were 228 and 286, resulting in the imposition in those years of total fines of €620,100 and €772,250 respectively. In addition, 177 vehicles were seized in 2013 and 155 in 2014.

I am advised also that, in certain defined categories of cases where marked fuel is detected in a vehicle, Revenue is prepared to refrain from the institution of legal proceedings where the person concerned agrees to pay a compromise sum in lieu of prosecution. These would include cases where a person is detected for the first time in charge of a motor vehicle, other than a commercial vehicle, where marked fuel is illegally present. The numbers of cases dealt with in this way in 2013 and 2014 were 627 and 614, resulting in payments to Revenue by the persons in question of €822,145 and €819,630 respectively.

Action against the illegal use of marked fuel is an integral part of Revenue's wide-ranging programme of action against all forms of fuel fraud. An extensive range of new measures have been introduced over recent years to tackle such fraud, including enhanced supply chain controls and the acquisition of a more effective fuel marker. Key measures include the following.

- The licensing regime for auto fuel traders was strengthened with effect from September 2011 to limit the ability of fuel criminals to get laundered fuel on to the market.

- A new licensing regime was introduced for marked fuel traders from October 2012, which was designed to limit the ability of criminals to source marked fuel for laundering.

- New requirements in relation to fuel traders' of stock movements and fuel deliveries were introduced to ensure that data are available to assist in supply chain analysis.

- New supply chain controls were introduced from January 2013 following significant investment in new IT systems. These returns require all licensed fuel traders to make monthly electronic returns to Revenue of their fuel transactions, to allow the detection of suspicious or anomalous transactions and patterns of distribution.

- An intensified targeting, in cooperation with other law enforcement agencies on both sides of the border, of enforcement action against suspected fuel laundering operations.

In addition, Revenue has, in partnership with Her Majesty's Revenue and Customs in the UK, identified a more effective fuel marker. The new marker will come into operation in both jurisdictions from midnight on the 31 March 2015.

To support further the integrity of the fuel distribution system and to minimise the risk of fraud, I introduced a provision in the Finance (No. 2 ) Act 2013 which will make a supplier who is reckless in supplying rebated fuel for a use connected with excise fraud liable for the duty at the standard rate of tax. This strengthens Revenue's hand in dealing with such traders.

I am assured by the Revenue Commissioners that they will continue to act robustly against all forms of fuel fraud, including the illegal use of marked fuel in motor vehicles.

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