Finance Act 2021

Offences and penalties

77 Fraudulent evasion

(1) A person commits an offence if the person is knowingly concerned in, or in the taking of steps with a view to, the fraudulent evasion (by that person or another person) of plastic packaging tax.

(2) The reference in subsection (1) to the evasion of plastic packaging tax includes reference to obtaining, in circumstances where there is no entitlement to it—

(a) a tax credit;

(b) a repayment of plastic packaging tax.

(3) A person guilty of an offence under this section is liable—

(a) on summary conviction in England and Wales—

(i) to imprisonment for a term not exceeding 12 months,

(ii) to a fine not exceeding £20,000 or (if greater) three times the total of the amounts of plastic packaging tax that were, or were intended to be, evaded, or

(iii) to both;

(b) on summary conviction in Scotland—

(i) to imprisonment for a term not exceeding 12 months,

(ii) to a fine not exceeding the statutory maximum or (if greater) three times the total of the amounts of plastic packaging tax that were, or were intended to be, evaded, or

(iii) to both;

(c) on summary conviction in Northern Ireland—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding the statutory maximum or (if greater) three times the total of the amounts of plastic packaging tax that were, or were intended to be, evaded, or

(iii) to both;

(d) on conviction on indictment—

(i) to imprisonment for a term not exceeding 7 years,

(ii) to a fine, or

(iii) to both.

(4) For the purposes of subsection (3), the amounts of plastic packing tax that were, or were intended to be, evaded are to be taken as including—

(a) the amount of any tax credit, and

(b) the amount of any repayment of plastic packaging tax,

which was, or was intended to be, obtained in circumstances when there was no entitlement to it.

(5) In determining for the purposes of subsection (3) the amounts of plastic packaging tax that were, or were intended to be, evaded, no account is to be taken of the extent to which any liability to tax of a person would be, or would have been, reduced by the amount of any tax credit or repayment of plastic packaging tax to which the person was, or would have been, entitled.

(6) In relation to an offence committed before the commencement of paragraph 24(2) of Schedule 22 to the Sentencing Act 2020, the reference in subsection (3)(a)(i) to 12 months is to be read as a reference to 6 months.

78 Misstatements

(1) A person commits an offence if, for purposes connected with plastic packaging tax, the person—

(a) produces or provides, causes to be produced or provided, or otherwise makes use of any document which is false in a material particular, and

(b) does so intending to deceive any person or to secure that a machine will respond to the document as if it were a true document.

(2) A person commits an offence if, in providing any information under any provision made by or under this Part the person—

(a) makes a statement which the person knows to be false in a material particular, or

(b) recklessly makes a statement which is false in a material particular.

(3) A person guilty of an offence under this section is liable (subject to subsection (4))—

(a) on summary conviction in England and Wales—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding £20,000, or

(iii) to both;

(b) on summary conviction in Scotland—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding the statutory maximum, or

(iii) to both;

(c) on summary conviction in Northern Ireland—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding the statutory maximum, or

(iii) to both;

(d) on conviction on indictment—

(i) to imprisonment for a term not exceeding 7 years,

(ii) to a fine, or

(iii) to both.

(4) In the case of an offence under this section where—

(a) the document referred to in subsection (1) is a return required under any provision made by or under this Part of this Act, or

(b) the information referred to in subsection (2) is contained in or otherwise relevant to such a return,

the maximum amount of the fine on summary conviction is the greater of £20,000 or the statutory maximum (as the case may be), and the amount equal to three times the sum of the amounts (if any) by which the return underestimates any person’s liability to plastic packaging tax.

(5) In subsection (4) the reference to the amount by which a person’s liability to plastic packaging tax is understated is the sum of—

(a) the amount (if any) by which the person’s gross liability was understated, and

(b) the amount (if any) by which any entitlements of the person to tax credits and repayments of plastic packaging tax were overstated.

(6) In subsection (5) “gross liability” means liability to plastic packaging tax before any deduction is made in respect of—

(a) any entitlement to any tax credits, or

(b) any repayment of plastic packaging tax.

79 Conduct involving evasions or misstatements

(1) A person commits an offence if the person’s conduct during any particular period must have involved the person committing one or more offences under section 77 or 78.

(2) For the purposes of any proceedings for an offence under this section it is immaterial whether the particulars of the offence or offences that must have been committed are known.

(3) A person guilty of an offence under this section is liable (subject to subsection (4))—

(a) on summary conviction in England and Wales—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding £20,000, or

(iii) to both;

(b) on summary conviction in Scotland—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding the statutory maximum, or

(iii) to both;

(c) on summary conviction in Northern Ireland—

(i) to imprisonment for a term not exceeding 6 months,

(ii) to a fine not exceeding the statutory maximum, or

(iii) to both;

(d) on conviction on indictment—

(i) to imprisonment for a term not exceeding 7 years,

(ii) to a fine, or

(iii) to both.

(4) In the case of any offence under this section, the maximum amount of the fine on summary conviction is the greater of £20,000 or the statutory maximum (as the case may be), and the amount equal to three times the sum of the amounts of plastic packaging tax which are shown to be amounts that were or were intended to be evaded by the conduct in question.

(5) For the purposes of subsection (4), the amounts of plastic packaging tax that were, or were intended to be, evaded are to be taken as including—

(a) the amount of any tax credit, and

(b) the amount of any repayment of plastic packaging tax,

which was, or was intended to be, obtained in circumstances when there was no entitlement to it.

(6) In determining for the purposes of subsection (4) the amounts of plastic packaging tax that were, or were intended to be, evaded, no account is to be taken of the extent to which any liability to tax of a person would be, or would have been, reduced by the amount of any tax credit or repayment of plastic packaging tax to which the person was, or would have been, entitled.

80 Penalty for contravening relevant requirements

(1) Where a person (P) fails to comply with a relevant requirement, P is liable to—

(a) a fixed penalty of £500, and

(b) a daily penalty of £40 for each day, after the first, on which the person continues to fail to comply.

(2) Where P is liable to a daily penalty in respect of a continuing failure to comply with a relevant requirement P is not liable to a further fixed penalty in respect of that failure.

(3) P is not liable to a penalty under this section in respect of an act or omission in respect of which P—

(a) has been convicted of an offence, or

(b) is liable to a penalty other than under this section.

(4) P is not liable to a penalty under this section if P satisfies the Commissioners or (on appeal) the appeal tribunal within the meaning of Schedule 11 that there is a reasonable excuse for the failure.

(5) For the purposes of subsection (4)—

(a) an insufficiency of funds is not a reasonable excuse, unless it is attributable to events outside P’s control,

(b) where P relies on any other person to do anything, that is not a reasonable excuse unless P took reasonable care to avoid the failure, and

(c) where P had a reasonable excuse for the failure but the excuse has ceased, P is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased.

(6) Where P is liable to a penalty under this section—

(a) the Commissioners or, on appeal, the appeal tribunal within the meaning of Schedule 11, may reduce the penalty to such amount (including nil) as they think proper;

(b) on an appeal relating to any penalty reduced by the Commissioners, the appeal tribunal may cancel the whole or any part of the Commissioners’ reduction.

(7) In this section, “relevant requirement” means an obligation or a requirement imposed by or under—

(a) section 58 (variation and correction of the register);

(b) section 61 (payment, collection and recovery);

(c) section 63 (records);

(d) section 65 (security for tax);

(e) section 68 (statements);

(f) section 69 (tax representatives);

(g) section 74 (death, incapacity or insolvency of person carrying on a business);

(h) section 75 (transfer of business as a going concern);

(i) Schedule 9 (secondary liability and assessment notices and joint and several liability notices);

(j) Schedule 13 (groups of companies).

(8) The Treasury may by regulations amend subsection (1) so as to substitute for the amounts for the time being specified there amounts taking account of inflation.

(9) The Treasury may by regulations amend subsection (7) so as to add or remove a requirement relating to plastic packaging tax as a “relevant requirement”.

(10) Schedule 14 makes provision about the assessment of penalties under this section.

81 Criminal proceedings

Sections 145 to 155 of CEMA 1979 (proceedings for offences, mitigation of penalties and certain other matters) apply in relation to offences under this Part as they apply in relation to offences under the customs and excise Acts.