Court puts cork in online booze trade

European ruling scuppers hopes of online shoppers

Written by Dinah Greek, Computeract!ve

Shoppers who had hoped to be able to bypass higher UK duty by buying their alcohol and cigarettes online from other countries have had their hopes dashed by the European Court of Justice.

Although shoppers can already buy these goods online, they have to pay full UK duty. Shoppers, often called 'booze cruisers', who want to benefit from buying cheaper goods because of lower taxes abroad have had to accompany the goods back themselves.

But a case in the EU court raised hopes that a ruling would give people the same rights when buying online.

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The case originally arose because of objections raised by a Dutch wine club which was charged domestic duty on wine purchased in France. The club had sent a van to France to load up with wine because French duty is much lower than in the Netherlands.

However, even though the amount it brought back was less than the individual limit of 90 litres for personal consumption, because no-one from the club accompanied the delivery, the Dutch authorities decided it was within its rights to charge domestic tax on vanload of wine.

It was taken to the European court and an interim ruling last year indicated it may be possible for shoppers to order these goods from countries offering lower excise duties online, via phone or mail order and have them delivered to their door by a third party.

The court ruling has thrown this out and means that shoppers won't be able to buy alcohol and cigarettes from EU countries with low rates of duty unless they bring them home in person.

"The court points out that, in order for products to be exempt from excise duty in the state of importation, the (EU) directive requires that those products be intended for the personal use of the private individual who has acquired them and that it therefore excludes products acquired by a private individual for the use of other private individuals," it said.

"Furthermore, the products in question must be transported personally by the private individual who purchased them."

The ruling will be welcome news for the Treasury which already loses around £1bn a year in revenue from booze cruises; it has been estimated if the ruling went in favour of online shoppers this could have rocketed to £7bn a year.

That would seem to assure the future of the booze cruise and be welcome news for the ferries as well. British shoppers wanting to take advantage of cheaper duty will have to continue to sail or drive to neighbouring countries to bring home their purchases in person.

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