Part II Spirits
Charge of excise duty
C15 Spirits: charge of excise duty.
There shall be charged on spirits—
a
imported into the United Kingdom; or
b
distilled, or manufactured by any other process whatsoever, in the United Kingdom,
Reliefs from excise duty
6 Power to exempt angostura bitters from duty.
On the importation of the aromatic flavouring essence commonly known as angostura bitters, the Commissioners may, subject to such conditions as they see fit to impose, direct the bitters to be treated for the purposes of the charge of duty on spirits as not being spirits.
F36A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
C27 Exemption from duty of spirits in articles used for medical purposes.
Duty shall not be payable on any spirits contained in an article imported or delivered from warehouse which is recognised by the Commissioners as being used for medical purposes.
C38F4 Remission of duty in respect of spirits used for medical or scientific purposes.
1
Where a person proposes to use spirits—
a
in the manufacture or preparation of any article recognised by the Commissioners as being an article used for medical purposes; or
b
for scientific purposes,
the Commissioners may, if they think fit and subject to such conditions as they see fit to impose, authorise that person to receive, and permit the delivery from warehouse to that person of, spirits for that use without payment of the duty chargeable thereon.
2
If any person contravenes or fails to comply with any condition imposed under this section F5his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
F63
Subsection (4) below applies if—
a
spirits are received and delivered in accordance with subsection (1) above,
b
they are not used as proposed, and
c
it is not shown to the satisfaction of the Commissioners that they can be accounted for by natural waste or other legitimate cause.
4
In such a case the Commissioners—
a
may assess as being excise duty due from the person concerned an amount equal to the duty that would have been chargeable on the spirits if, at the time of delivery from warehouse, they had been delivered for home use and otherwise than in accordance with subsection (1) above, and
b
may notify him or his representative accordingly.
F639 Remission of duty on spirits for methylation.
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C410 Remission of duty on spirits for use in art or manufacture.
1
Where, in the case of any art or manufacture carried on by any person in which the use of spirits is required, it is proved to the satisfaction of the Commissioners that the use of F62denatured alcohol is unsuitable or detrimental, the Commissioners may, if they think fit and subject to such conditions as they see fit to impose, authorise that person to receive, and permit the delivery from warehouse to that person of, spirits for use in that art or manufacture without payment of the duty chargeable thereon.
2
If any person contravenes or fails to comply with any condition imposed under this section F7 his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
F83
Subsection (4) below applies if—
a
spirits are received and delivered in accordance with subsection (1) above,
b
they are not used as proposed, and
c
it is not shown to the satisfaction of the Commissioners that they can be accounted for by natural waste or other legitimate cause.
4
In such a case the Commissioners—
a
may assess as being excise duty due from the person concerned an amount equal to the duty that would have been chargeable on the spirits if, at the time of delivery from warehouse, they had been delivered for home use and otherwise than in accordance with subsection (1) above, and
b
may notify him or his representative accordingly.
11 Relief from duty on imported goods not for human consumption containing spirits.
F91
On the importation of goods not for human consumption containing spirits as a part or ingredient thereof, the Commissioners may, subject to such conditions as they may think fit to impose, direct the goods to be treated for the purposes of the charge of duty on spirits (and in particular the charge under section 126 of the Management Act) as not containing spirits.
F102
Subsection (3) below applies if—
a
the Commissioners make a direction under subsection (1) above, but
b
it turns out that the goods were for human consumption.
3
In such a case the Commissioners—
a
may assess as being excise duty due from the relevant person an amount equal to the duty that would have been chargeable on the goods if the direction had not been made, and
b
may notify him or his representative accordingly.
4
The reference in subsection (3) above to the relevant person is to the importer or (if different) the person who sought the direction.
Manufacture of spirits
12 Licence to manufacture spirits.
1
No person shall manufacture spirits, whether by distillation of a fermented liquor or by any other process, unless he holds an excise licence for that purpose under this section (referred to in this Act as a “distiller’s licence”).
F112
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F123
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F644
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5
Where the largest still to be used on any premises in respect of which a distiller’s licence is sought for the manufacture of spirits by distillation of a fermented liquor is of less than F1318 hectolitres capacity, the Commissioners may refuse to grant the licence or may grant it only subject to such conditions as they see fit to impose F14and where the largest still so used on any premises in respect of which a licence is held is of less than that capacity, the Commissioners may revoke the licence or attach to it such conditions as they see fit to impose.
F156
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P113 Power to make regulations relating to manufacture of spirits.
1
The Commissioners may, with a view to the protection of the revenue, make regulations—
a
regulating the manufacture of spirits, whether by distillation of a fermented liquor or by any other process;
b
for securing and collecting the duty on spirits manufactured in the United Kingdom; and
c
regulating the removal of spirits from a distillery;
and different regulations may be made in respect of manufacture for different purposes or by different processes.
F161A
Without prejudice to the generality of subsection (1) above, regulations under that subsection may—
a
provide for the imposition under the regulations of conditions and restrictions relating to the matters mentioned in that subsection; and
b
impose or provide for the imposition of requirements on a manufacturer of spirits to keep and preserve records relating to his business as such a manufacturer and to produce them to an officer when required to do so for the purpose of allowing him to inspect them, to copy or take extracts from them or to remove them at a reasonable time and for a reasonable period.
1B
Where any documents removed under the powers conferred by subsection (1A)(b above are lost or damaged the Commissioners shall be liable to compensate their owner for any expenses reasonably incurred by him in replacing or repairing the documents.
2
Where—
a
the Commissioners are satisfied that any process of manufacture carried on by any person involving the manufacture of spirits is primarily directed to the production of some article other than spirits; or
b
the Commissioners see fit in the case of any person manufacturing spirits by any process other than distillation of a fermented liquor,
they may direct that, subject to compliance with such conditions as they think proper to impose, such of the provisions of this Act relating to the manufacture of, or manufacturers of, spirits or such of any regulations made under this section as may be specified in the direction shall not apply in the case of that person.
F172A
If the Commissioners so direct, spirits manufactured by a process to which a direction under subsection (2) above applies shall be treated as not being within the charge of duty on spirits under section 5 above.
C53
If, save as provided in subsection (2) above, any person contravenes or fails to comply with any regulation made under subsection (1) above F18or with any condition, restriction or requirement imposed under such a regulationF19his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties) and any spirits, and any vessels, utensils and materials used for distilling or otherwise manufacturing or for preparing spirits, F19in respect of which any person contravenes any such regulation, or fails to comply with any such regulation, condition, restriction or requirement, shall be liable to forfeiture.
F204
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5
If any person in whose case a direction is given by the Commissioners under subsection (2) above acts in contravention of or fails to comply with any condition imposed under that subsection which is applicable in his case, F21his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any spirits in respect of which any person contravenes or fails to comply with any such condition shall be liable to forfeiture.
F6514 Duty on spirits—attenuation charge.
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P215 Distiller’s warehouse.
1
A distiller may provide in association with his distillery a place of security for the deposit of spirits manufactured at that distillery and, if that place is approved by the Commissioners and entry is made thereof by the distiller, may deposit therein without payment of duty any spirits so manufactured.
F222
The Commissioners may approve such a place of security for such periods and subject to such conditions as they think fit.
3
A place of security for the time being approved by the Commissioners under subsection (1) above is referred to in this Act as a “distiller’s warehouse”.
F664
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F235
Where, after the approval of a distiller’s warehouse, the distiller by whom it is provided makes, without the previous consent of the Commissioners, an alteration in or addition to that warehouse, the making of the alteration or addition shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
6
The Commissioners may make regulations—
a
regulating the warehousing of spirits in a distiller’s warehouse;
b
permitting, in so far as it appears to them necessary in order to meet the circumstances of any special case and subject to such conditions as they see fit to impose, the deposit by a distiller in his distiller’s warehouse without payment of duty of spirits other than spirits manufactured at the distillery associated with that warehouse;
c
for securing the duties on spirits so warehoused;
and subject to any such regulations, the provisions of Parts VIII and X of the Management Act, except sections 92 and 96, shall apply in relation to a distiller’s warehouse and spirits warehoused therein as they apply in relation to an excise warehouse approved under subsection (1) of section 92 of that Act and goods warehoused therein.
F246A
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C6C77
If any person contravenes or fails to comply with any regulation made under subsection (6) above F25or with any condition . . . F26 imposed under such a regulationF27his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any spirits in respect of which any person contravenes any such regulation, or fails to comply with any such regulation or condition, shall be liable to forfeiture.
F288
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9
The Commissioners may at any time for reasonable cause revoke or vary the terms of their approval of a distiller’s warehouse.
C916 Racking of duty-paid spirits at distillery. C8
1
The Commissioners may, with a view to the protection of the revenue, make regulations regulating the racking at a distillery of duty-paid spirits.
2
If any person contravenes or fails to comply with any regulation made under this section, F29his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any spirits in respect of which any person contravenes or fails to comply with any such regulation shall be liable to forfeiture.
F303
If on an officer’s taking stock of duty-paid spirits racked at a distillery, a greater quantity of alcohol is found at the place of racking than ought to be there according to any accounts required by regulations made under this section to be kept thereof then—
a
duty shall be charged on the excess; and
b
if the excess amounts to more than 1 per cent. of the quantity of alcohol lawfully brought into the place of racking since stock was last taken, such a quantity of spirits as contains an amount of alcohol equal to that excess shall be liable to forfeiture, and F31there shall be deemed to have been conduct by the distiller attracting a penalty under section 9 of the Finance Act 1994 (civil penalties).
4
Paragraph (b) of subsection (3) above shall not apply where the excess of alcohol is less than 3 litres.
17 Offences in connection with removal of spirits from distillery, etc.
1
If any person—
a
conceals in or without the consent of the proper officer removes from a distillery any wort, wash, low wines, feints or spirits; or
b
knowingly buys or receives any wort, wash, low wines, feints or spirits so concealed or removed; or
c
knowingly buys or receives or has in his possession any spirits which have been removed from the place where they ought to have been charged with duty before the duty payable thereon has been charged and either paid or secured, not being spirits which have been condemned or are deemed to have been condemned as forfeited,
he shall be guilty of an offence under this section and may be detained, and the goods shall be liable to forfeiture.
2
A person guilty of an offence under this section shall be liable—
a
on summary conviction, to a penalty of the prescribed sum or three times the value of the goods, whichever is the greater, or to imprisonment for a term not exceeding 6 months, or to both; or
b
on conviction on indictment, to a penalty of any amount, or to imprisonment for a term not exceeding 2 years, or to both.
Rectifying and compounding of spirits
18 Rectifier’s and compounder’s licences.
1
No person shall rectify or compound spirits and keep a still for that purpose unless he holds an excise licence under this section as a rectifier.
2
Except as permitted by the Commissioners and subject to such conditions as they see fit to impose, no other person shall compound spirits unless he holds an excise licence under this section as a compounder.
F323
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F334
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F675
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6
Without prejudice to section 25 below and except as provided by this section, if any person rectifies or compounds spirits otherwise than under and in accordance with an excise licence under this Act so authorising him, F34his doing so shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
19 Regulation of rectifying and compounding.
1
The Commissioners may, with a view to the protection of the revenue, make regulations—
a
regulating the rectifying and compounding of spirits;
b
regulating the receipt, storage, removal and delivery of spirits by rectifiers and compounders;
and different regulations may be made under this section for rectifiers and compounders.
F351A
Without prejudice to the generality of subsection (1) above, regulations under that subsection may—
a
provide for the imposition under the regulations of conditions and restrictions relating to the matters mentioned in that subsection; and
b
impose or provide for the imposition under the regulations of requirements on rectifiers and compounders of spirits to keep and preserve records relating to their business as such and to produce them to an officer when required to do so for the purpose of allowing him to inspect them, to copy or take extracts from them or to remove them at a reasonable time and for a reasonable period.
1B
Where any documents removed under the powers conferred by subsection (1A)(b) above are lost or damaged the Commissioners shall be liable to compensate their owner for any expenses reasonably incurred by him in replacing or repairing the documents.
2
If any person contravenes or fails to comply with any regulation made under this section F36or with any condition, restriction or requirement imposed under any such regulation, F37his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any spirits and any other article in respect of which any person contravenes any such regulation, or fails to comply with any such regulation, condition, requirement or restriction, shall be liable to forfeiture.
F383
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20 Penalty for excess or deficiency in rectifier’s stock.
F391
If at any time when an account is taken by an officer and a balance struck of the spirits in the stock of a rectifier any excess of alcohol is found, such a quantity of spirits as contains an amount of alcohol equal to the excess shall be liable to forfeiture and F40there shall be deemed to have been conduct by the rectifier attracting a penalty under section 9 of the Finance Act 1994 (civil penalties).
2
If at any time when an account is taken and a balance struck as aforesaid any deficiency of alcohol is found which cannot be accounted for to the satisfaction of the Commissioners and which exceeds 5 per cent. of the aggregate of—
a
the quantity of alcohol in the balance of spirits struck when an account was last taken; and
b
the quantity of alcohol contained in any spirits since lawfully received by the rectifier,
F40there shall be deemed to have been conduct by the rectifier attracting a penalty under section 9 of the Finance Act 1994 (civil penalties).
3
For the purposes of any such account and of this section—
a
spirits used by a rectifier in warehouse in pursuance of warehousing regulations shall be deemed not to be spirits in his stock as a rectifier; and
b
where a rectifier also carries on the trade of a wholesaler of spirits on the same premises, all spirits in his possession (other than spirits so used) shall be deemed to be spirits in his stock as a rectifier.
F6821 Restrictions relating to rectifiers.
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22 Drawback on British compounds and spirits of wine.
C10C111
Subject to the provisions of this section and to such conditions and restrictions as the Commissioners may by regulations impose, a rectifier or compounder may warehouse in an excise warehouse on drawback any British compounded spirits or spirits of wine rectified or compounded by him from duty-paid spirits and not containing any methyl alcohol or any wine, made-wine or other fermented liquor.
2
British compounded spirits may be warehoused under this section for exportation F41or removal to the Isle of Man, for use in any permitted operation in warehouse, for use as stores or, except in the case of tinctures other than perfumed spirits, for home use.
3
Spirits of wine may be warehoused under this section—
a
For exportation, for use in any permitted operation in warehouse, or for use as stores; or
b
if of a strength of not less than F4285 per cent., for delivery for use in art or manufacture under section 10 above; or
c
if of a strength of not less than F4399 per cent., for home use.
F44C12C113A
The Commissioners may, subject to such conditions and restrictions as they may by regulations impose, allow drawback to any person on any British compounded spirits or spirits of wine rectified or compounded by him from duty-paid spirits and not containing any methyl alcohol or any wine, made-wine or other fermented liquor if they are exported direct from his premises.
C134
The Commissioners may, subject to such conditions and restrictions as they may by regulations impose, allow drawback on tinctures or spirits of wine exported or, except in the case of spirits of wine, shipped as stores by a rectifier or compounder direct from his premises.
F45C14C115
Subject to subsection 6 below, the amount of any drawback payable under this section shall be calculated by reference to the quantity of alcohol contained in the British compounded spirits or spirits of wine and shall be an amount equal to the duty at the appropriate rate chargeable on spirits containing an equal quantity of alcohol and so chargeable at the date when duty was paid on the spirits from which the British compounded spirits or spirits of wine were rectified or compounded.
F466
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7
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8
British compounded spirits warehoused under this section for home use shall upon delivery from warehouse for that purpose be chargeable with the same rate of duty as spirits warehoused by a distiller.
9
If any person contravenes or fails to comply with any regulation made under this section F48his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any article in respect of which any person contravenes or fails to comply with any such regulation shall be liable to forfeiture.
10
In this section “tinctures” means medicinal spirits, flavouring essences, perfumed spirits and such other articles containing spirits as the Commissioners may by regulations specify as tinctures.
F4923 Allowance on British compounds.
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General provisions relating to manufacture of spirits and British compounds
F6924 Restriction on carrying on of other trades by distiller or rectifier.
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25 Penalty for unlawful manufacture of spirits, etc.
1
Save as provided by or under this Act, any person who, otherwise than under and in accordance with an excise licence under this Act so authorising him—
a
manufactures spirits, whether by distillation of a fermented liquor or by any other process; or
b
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F50 uses a still for distilling, rectifying or compounding spirits; or
c
distils or has in his possession any low wines or feints; or
d
not being a vinegar-maker, F51produces or makes or has in his possession any wort or wash fit for distillation,
shall be liable on summary conviction to a penalty of F52level 5 on the standard scale.
2
Where there is insufficient evidence to convict a person of an offence under subsection (1) above, but it is proved that such an offence has been committed on some part of premises belonging to or occupied by that person in such circumstances that it could not have been committed without his knowledge, that person shall be liable on summary conviction to a penalty of F53level 3 on the standard scale.
3
Any person found on premises on which spirits are being unlawfully manufactured or on which a still is being unlawfully used for rectifying or compounding spirits may be detained.
4
All spirits and stills, vessels, utensils, wort, wash and other materials for manufacturing, distilling or preparing spirits—
a
found in the possession of any person who commits an offence under subsection (1) above; or
b
found on any premises on which such an offence has been committed,
shall be liable to forfeiture.
5
Notwithstanding any other provision of the Customs and Excise Acts 1979 relating to goods seized as liable to forfeiture, any officer by whom any thing is seized as liable to forfeiture under subsection (4) above may at his discretion forthwith spill, break up or destroy that thing.
6
Without prejudice to any other power conferred by the Customs and Excise Acts 1979, if any officer has reasonable grounds for suspecting that any thing liable to forfeiture under this section is in or upon any land or other premises in Northern Ireland, he may enter upon those premises, if need be by force, and search them and seize and remove any thing which he has reasonable grounds to believe to be so liable.
General provisions relating to spirits
F7026 Importation and exportation of spirits.
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27. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F54
31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F55
F7132 Restriction on transfer of British spirits in warehouse.
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33 Restrictions on use of certain goods relieved from spirits duty.
1
If any person uses otherwise than for a medical or scientific purpose—
a
any mixture which has on importation been relieved to any extent of the duty chargeable in respect of the spirits contained in it or used in its preparation or manufacture by reason of being a mixture which is recognised by the Commissioners as being used for medical purposes; or
b
any article containing spirits which were exempted from duty under section 7 above; or
c
d
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F57
F58his doing so shall, unless he has complied with the requirements specified in subsection (2) below, attract a penalty under section 9 of the Finance Act 1994 (civil penalties), and any article in his possession in the preparation or manufacture of which the mixture or article has been used shall be liable to forfeiture.
2
The requirements with which a person must comply to avoid incurring liability under subsection (1) above are that—
a
he must obtain the consent of the Commissioners in writing to the use of the mixture or article otherwise than for a medical or scientific purpose; and
b
he must pay to the Commissioners an amount equal to the difference between the duty charged on the mixture and the duty which would have been chargeable if it had not been a mixture recognised as mentioned in subsection (1)(a) above, or to the amount of the duty F59remitted, as the case may be.
3
The Commissioners may make regulations for the purpose of enforcing the provisions of this section.
4
Regulations under subsection (3) above may in particular require any person carrying on any trade in which spirits, or mixtures or articles containing or prepared or manufactured with spirits, are in the opinion of the Commissioners likely to be or to have been used—
a
to give and verify particulars of the materials which he is using or has used and of any such mixtures or articles which he has sold; and
b
to produce any books of account or other documents of whatever nature relating to any such materials, mixtures or articles.
5
If any person contravenes or fails to comply with any regulation made under subsection (3) above F60his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
6
In this section “mixture” includes a preparation and a compound, and any reference to a mixture or article includes a reference to any part thereof.
34 Prohibition of grogging.
1
No person shall—
a
subject any cask to any process for the purpose of extracting any spirits absorbed in the wood thereof; or
b
have on his premises any cask which is being subjected to any such process or any spirits extracted from the wood of any cask.
F612
A contravention of this section shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
3
All spirits extracted contrary to this section and every cask which is being subjected to any such process or which, being upon premises upon which spirits so extracted are found, has been subjected to any such process shall be liable to forfeiture.
F7235 Returns as to importation, manufacture, sale or use of alcohols.
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