The government has opened the doors to bootleggers by relaxing Customs checks at ports, claim furious trade leaders.
New guidelines issued this week mean Customs officers will no longer be able to use heavy-handed tactics on suspected bootleggers. Officers will now have to prove that goods are being brought in for illegal re-sale instead of the shopper having to show their goods are for personal use.
The damning news was coupled with an announcement by Treasury minister John Healey that personal allowance for cigarettes is to rise from 800 to 3,200 and hand-rolling tobacco from 1kg to 3kg.
The trade is now demanding the government takes action by reducing duty rates.
Stuart Neame, vice-chairman of Kent brewer Shepherd Neame, said: "The minister has made it clear that he is only interested in stopping the big time smugglers and this is a green light for the small timers."
Mr Neame claims to have lost millions of pounds of trade since the trade barriers between Europe and Britain were broken in 1993.
"It makes it all the more pressing to bring down duty by about 8p, which we've always argued will not cost the Treasury a penny and is all that is necessary to stop the cross-Channel trade."
The Labour government has so far failed to slash duty rates to bring them into line with Europe - a move that will undoubtedly remove the incentive for bootleggers to travel to France and stock up on cheap booze.
In return, Chancellor Gordon Brown has tried to reassure the trade that stringent checks at ports help curb the illegal activity which is putting pubs out of business and resulting in children getting their hands on alcohol being touted on the streets.
Despite this, Mr Healy defended the decision. "We want to reinforce the rights of shoppers and reinforce the regime against smugglers, so that those cheating the system know their smuggling days are numbered," he said.
A spokesman for his office said neither Mr Healey or the Chancellor were prepared to outline whether there could be a duty cut next Spring.
This is despite the fact that in February European commissioner Fritz Bolkestein, concluded that the difference between states like the UK and France had led to widespread smuggling.
He recommended that states with high duty rates place a freeze on duty, while those with low duty rates should increase them in line with inflation until eventually harmonisation is achieved.
Other changes announced include:
- a reduction in the penalty for a first smuggling offence to payment of the duty owed instead of seizure of goods and property
- the legal burden of proof putting the onus on customs to prove that goods are not for personal use
- a change in the wine allowance to allow up to 90 litres of still or sparkling wine - previously the indicative level for sparkling wine was 60 litres
What the trade has to say
John McNamara, chief executive of the British Institute of Innkeeping:
"The BII has said all along that the only real way to stop alcohol smuggling on the scale it is now happening is to lower duty rates.
"This is not about innocent holiday-makers travelling back from France with a few bottles of beer or packets of cigarettes, this is about organised crime on a massive scale.
"It is estimated that alcohol smuggling costs the UK £750m every year, but with only a small cut in duty, profits for smugglers would be slashed and the illegal trade would be stopped, without the need to harass legitimate day-trippers. "
Nick Bish, chief executive at the Association of Licensed Multiple Retailers, said: "This problem wouldn't exist if the government reduced duty to bring it in line with the rest of Europe. This could make things much worse."
Tony Payne of the Federation of Licensed Victuallers Association:
"The government now needs to lower the duty rate. We will be writing to the Home Office and the Treasury to bring their attention to the problem."
"This will open up the doors for smuggling and it will also encourage companies to run these booze trips more frequently.
Karen Kelshaw, spokeswoman for the British Beer & Pub Association said: "What we need now is a reduction in duty rates or at the very least a complete freeze on them next year. We need to put continued pressure on the government to reduce duty in the next budget.
"We want a fair system for innocent shoppers but we also want to catch the smugglers."