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IP/08/241

Brussels, 14 February 2008

Excise duties: Commission proposes measures to strengthen the fight against fraud and simplify certain rules for private and commercial cross-border purchases

The European Commission has adopted a proposal aimed at strengthening the fight against tax fraud and removing certain unnecessary tax obstacles to the movement of excise goods within the EU. The proposal seeks to review the Directive[1] on the general arrangements for products subject to excise duty (alcoholic beverages, tobacco products and mineral oils). It would provide a legal framework for the use of a computerised system to monitor the movement of excise goods for which no tax has been paid yet. This Excise Movement Control System (EMCS), which should be operational from April 2009, will help to better tackle excise fraud by creating a faster and more efficient means of information exchange between excise authorities. Today's proposal also aims to liberalise existing rules for alcoholic beverages bought in one Member State and transported to another, and to simplify rules on the commercial movement of excise goods.

EU Taxation and Customs Commissioner László Kovács said: "The Commission and Member States are determined to combat fraud within the EU. The use of an electronic information exchange system to monitor the movement of excise goods will greatly increase our chances of achieving this goal, by allowing for better targeted and more risk-based controls. Today's proposal also contains important provisions which will ensure that private individuals and businesses in the EU are free to buy and sell goods across borders without unnecessary tax obstacles."

Excise Movement Control System (EMCS) to monitor movements of goods for which no duties have been paid

The Excise Movement Control System (ECMS) was conceived in light of a number of weaknesses identified in the current paper-based system for monitoring the movement of excise goods under suspension of duties (goods for which no duties have yet been paid) within the EU.

Today's proposal would provide a legal framework in which the EMCS could function. Once operational, it will replace the paper-based procedures and will be a crucial tool for tackling fraud. Moreover, it will facilitate trade by reducing related costs, as guarantees for duties will be released much quicker.

The EMCS will introduce electronic processing for declaring, monitoring and discharging movements of excise products under suspension of excise duties within the EU. EMCS will therefore:

  • allow both Member States and traders to monitor movements electronically in real-time,
  • reduce the time needed for the discharge of tax liability for excise movements,
  • provide excise authorities with the essential tools to effectively address fraud by permitting a more integrated, faster and risk oriented approach to controls.

First movements under EMCS are expected to start in 2009.

Movements outside excise duty suspension for private and commercial purposes

The Commission's proposal also includes elements to simplify and liberalise the rules on intra-EU movements of products (mainly alcohol) on which excise duty has already been paid in a Member State.

For private individuals, the proposal aims to clarify the existing rules which apply to moving goods from one Member State to another, and to bring them more into line with the internal market principle that products acquired by private individuals for their own use should be taxed in the Member State in which they are bought.

For goods moved for commercial purposes, the Commission proposes that the basic principle whereby excise duty is payable in the Member State of destination is maintained, but that the procedures to be followed in that Member State are simplified and harmonised.

These provisions for the private and commercial movement of excise goods within the EU were already proposed by the Commission in 2004. However, following discussions in Council, it was decided that they should be suspended until the Commission proposed a complete review of the Directive on the general arrangements for products subject to excise duty, as it has done today.
The text of the proposal is available at this web link:

http://ec.europa.eu/taxation_customs/taxation/excise_duties/circulation_control/legislation/index_en.htm
For further information on the EMCS project, see:

http://ec.europa.eu/taxation_customs/taxation/excise_duties/circulation_control/index_en.htm
For further information on the legislation on excise products, see:

http://ec.europa.eu/taxation_customs/taxation/excise_duties/common_provisions/index_en.htm


[1] Council Directive 92/12/EEC of 25 February 1992


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