Wholesalers must unite to drive “rogue traders” who dodge tobacco and alcohol duties out of business, says Rodney Hunt, chairman of the Federation of Wholesale Distributors.
In his opening address at the FWD’s 15th annual Drinksummit in Stratford-upon-Avon, Hunt said such players continued to pose a serious threat to the market. “There is a growing concern at the number of operators selling product at competitive prices they could only achieve through tax fraud.”
He renewed the FWD’s challenge to HM Customs & Excise to step up its action against wholesalers trading outside the law. “HM Customs has been slow to act against these rogue traders who have decimated legitimate cash & carries. Only the most naïve can suggest they are trading legally.”
Hunt was referring to
wholesalers who ship over cigarettes and booze illegally so they can sell products cheaply, without shelling out for duties.
However, he made it clear that responsibility for tackling the culprits did not lie just with Customs officials. He reminded wholesalers that Customs had a hotline for people to call to report duty fraud and urged them to use it if they had any
information. “If there are enough calls regarding these operators, Customs will have to act. It’s important that we compete against these fraudsters.”
John Murphy, FWD director general, echoed Hunt’s comments as he brought the conference to a close. “We must act to drive duty and VAT fraudsters, who sell cases of product at £2-£4 below legitimate prices, out of business. Those of us who can do so, let’s get calling.”
Separately, Hunt called on suppliers at the event to help wholesalers bring their prices more in line with those of the multiple retailers. And he called for more backing from manufacturers on promotions.
It would make particular sense, he said, in certain impulse categories where independent retailers held majority market share. And the tough tactics of the multiples on pricing should provide more incentive for suppliers to work with independents. “As the multiples become more dictatorial, there should be a greater desire to support the independent sector.”
Hunt added that the FWD had also received the backing of some suppliers over its campaign to lobby the Office of Fair Trading to investigate Tesco’s retail dominance.
‘Spill the beans on booze and tobacco VAT-and-duty dodgers’Rod Addy