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Customs Bill 2014: Second Stage (Resumed) (Continued)

Thursday, 5 February 2015

Dáil Éireann Debate
Vol. 866 No. 3

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(Speaker Continuing)

[Deputy Tony McLoughlin: Information on Tony McLoughlin Zoom on Tony McLoughlin] I do not need to elaborate here how this activity is affecting their business trade, at a time when revenues are already dwindling. Three small retailers closed in Sligo town just last week.

Not one red cent of this €3 will make its way back to the Exchequer, and in fact, it will more than likely be used by criminal organisations to further their criminality and increase their profits in this country and beyond. Just this week we have seen the extent to which these criminal gangs will go in order to evade both the Irish customs officials and their counterparts in the United Kingdom. The massive seizure of over €2 million worth of raw tobacco in a joint raid by Customs and Excise, the PSNI and An Garda Síochána shows the smugglers' intent and capabilities.

Another area where the Customs Bill will be beneficial is in the State's attempts to tackle the rise in the online purchasing of counterfeit goods from which the State receives no VAT. This practice is on the rise internationally, and greater co-operation between Irish customs and our international partners is needed to combat this trend. A number of retailers in my constituency have informed me that this practice is having a damaging effect on local retailers.

While I strongly support the contents of the Bill, I believe that fine of just €5,000, listed in a number of sections of this Bill, for a person convicted of an offence under customs law is too lenient and should be examined again. This fine needs to be higher, as it will not deter people from taking the chance of smuggling illegal or prohibited goods, both into and out of the State at its current level.

Along with this welcome modernised customs legislation, I also strongly believe the State needs to invest more funding in the resources available to Customs and Excise, in order to help further combat the threat our country faces from smugglers and criminal gangs.

I have stated before that an agency similar to the Criminal Assets Bureau should be established within Customs and Excise and the Garda solely to tackle the importation and distribution of illegal tobacco products. There needs to be an intelligence-led strategy with officers seconded to this unit from the Garda and Customs and Excise who will target the importers and distributors throughout the country. It will cost money but this funding can be obtained through a levy or tax on cigarettes, rather than directly from the Exchequer. However, it would need a proper budget and mandate to tackle the crime of tobacco smuggling, which is estimated to cost the taxpayer €450 million per year.

It is clear from the facts that we are not winning the battle with these criminal gangs and smugglers at present. More financial resources for Customs and Excise and the Garda are needed along with this new legislation. However, I welcome the legislation and I hope it will be beneficial to their efforts.

I pay tribute to and commend the work the Irish Customs and Excise service does in protecting our State. It is often a thankless job and it is important that their hard work and effort is recognised and commended while discussing this new and welcome customs legislation.

Deputy John Paul Phelan: Information on John Paul Phelan Zoom on John Paul Phelan I pick up where Deputy McLoughlin left off. I thank the Customs and Excise service and An Garda Síochána for their efforts in protecting our borders commercially. The Deputy pointed out that they may need more resources. I know there is a constant demand on Ministers for more resources. I will make that point later in my contribution.

We are dealing with legislation in the customs area that goes back to 1876, which is a long time ago. The importation of articles and material into the country has changed considerably in that 140 year period. I welcome the measures in the legislation which take account of the changes that have taken place in the intervening period, not least the effect of European Union regulation and law in this area. I know that is part of the Bill we are discussing and the Minister referred to it in his opening comments. I welcome that the Bill carries forward the existing customs appeals procedures.

Further to Deputy McLoughlin's contribution, my major focus is on the importation of illegal or counterfeit goods and other materials, principally tobacco and fuel. I am a member of a committee of the British-Irish Parliamentary Assembly that is investigating mainly fuel laundering and counterfeit importation in general. We have been presented with pretty strong evidence of such illegal activities that continue in the country. I appeal to the Minister of State on the issue of counterfeit cigarettes. I speak as somebody who from time to time socially avails of tobacco. Some people might say I have a vested interest. I can assure the House that my vested interest is in protecting people's health and protecting the taxpayer.

Many of these counterfeit cigarettes are of a particularly dangerous quality and standard. That goes above and beyond the obvious negative health effects smoking has on individuals. That is one factor to be taken into consideration. The other is the loss to the Exchequer, which is hard to quantify for sure. In my part of the world there is considerable anecdotal evidence of significant sales of counterfeit tobacco products. Representatives of those involved in the legal sale of tobacco have supplied me with evidence of particular activities that go on in some of our port towns and the surrounding hinterland. They report significant reductions in the sales of tobacco products at times when significant ships come into that port town. I know it is anecdotal evidence and it is hard to quantify it exactly. However, all these retail representatives tell me the same story.

Kilkenny is an unusual area in that it is an inland county with two ports - the Port of New Ross and the Port of Waterford. The Port of New Ross, partly, and the Port of Waterford, wholly, are located in County Kilkenny. Significant evidence has been presented to me of activities that coincide with the arrival of certain vessels from certain areas into those port facilities and the resultant decline in the sale of legal tobacco products in outlets in the immediate hinterlands of those ports. It is also obvious that certain individuals, who have no other obvious source of wealth or income, manage to live lifestyles that are incompatible with what their legal income might be determined to be because they are allegedly, at least, involved in these activities.

I know there has been investment in recent years in additional scanning facilities at our ports. There is at least one mobile scanning unit and there may be others. I ask the Minister of State to clarify that in his concluding remarks. More investment is needed in this area because it will have a knock-on beneficial effect for the Exchequer in terms of ensuring that the tobacco products sold here are legal.

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