Tracking Alcohol and Oil Production

The 2017 ITIC study on the development of modern revenue controls on alcoholic beverages concluded that, although there are some advantages to the introduction of these systems, tax stamps and the related checking equipment are a sub-optimal policy choice and should not be considered a stand-alone solution. Instead, the goals of curbing the illicit trade in alcohol and protecting tax revenues require a much wider package of effective monitoring, control, and enforcement measures.

Fiscal markers for hydrocarbon oil products can be very useful in enabling revenue authorities to track the flow of the different products through the supply chain to the retail stage with mobile units carrying out random tests to establish the authentic nature of the product at the retail sales point. These, too, need to be part of a comprehensive anti-illicit trade strategy that should include public awareness and support programmes as well as a national enforcement plan.

The Astana Time recently ran an article reporting on the new system Kazakhstan has launched to track alcohol and oil products: https://astanatimes.com/2018/03/kazakhstan-launches-new-system-to-track-alcohol-oil-product-production-distribution/

OECD Task Force on Countering Illicit Trade Meets in Paris

The OECD Task Force on Countering Illicit Trade held its fifth meeting on 28-29 March in Paris, with over 80 attendees ranging from Customs and/or Revenue Authorities of OECD Member States, NGOs, academics, and private-sector firms (such as Apple and DHL). A broad range of national government agencies and international organizations – Ministries of Finance and Justice, Her Majesty’s Revenue and Customs, U.S. Department of Homeland Security, Europol, World Customs Organization, and EU Intellectual Property Office – were represented at the meeting. Discussions focused on strengthening institutional capacities to counter illicit trade, including through e-commerce, as well as countering illicit trade in counterfeits and wildlife, as well as illicit trade conducted in Free Trade Zones.

Attendees endorsed the future development of a voluntary Code of Conduct for businesses operating in Free Trade Zones and taking steps to strengthen cooperation among Customs, mail operators and logistics providers to improve risk assessment and enforcement action related to internet sales of counterfeit goods.

The conference maintained a high-level of interest throughout with excellent, well-presented papers and presentations due to the strong leadership of Task Force Chair David Luna, and tremendous support from the OECD team of Rolf Alter, Jack Radisch and Michael Morantz.

ITIC Advisor Speaks on Alcohol Tax Stamps

ITIC Program Advisor Liz Allen gave a presentation at this week’s Tax Stamp Forum in Berlin about the development of modern revenue control on alcoholic beverages. Her presentation was based on joint research conducted by ITIC and Oxford Economics into the effectiveness of different types of tax stamps used in a number of different countries. The conclusion drawn was that modern tax stamps can be helpful in tackling illicit trade, especially if they are but one component of a comprehensive national strategy to address both the supply and demand aspects of the illegal trade. The research across several countries was well received by revenue and customs officials participating in the conference.