FWD and ACS call for track and trace clarity

Letter to HMRC calls for answers about problems with track and trace regulation requirements

Retailers and wholesalers have written to HMRC calling for answers over concerns about ongoing problems with requirements under the track and trace regulations to scan and record the movement and sale of tobacco.

The letter, written by the Association of Convenience Stores and the Federation of Wholesale Distributors to the Exchequer Secretary to the Treasury, highlights serious concerns over range of issues that remain unaddressed with the introduction of track and trace rules for tobacco products.

The issues with track and trace, which have been previously raised with HMRC but have not been addressed, include a range of technical problems with the software required for the system, confusion over how tobacco theft is handled in the system, and significant operational difficulties experienced by wholesalers.

ACS and FWD are also seeking urgent clarification on the role of tobacco manufacturers in providing funding for the necessary equipment to comply with the regulations, citing concerns from members about the lack of clarity over who is responsible for the maintenance, upkeep and replacement of hardware and software in the long term.

James Bielby, FWD chief executive, said: “Wholesalers have installed equipment, trained staff and helped tobacco retailers register, but there has been very little clarity about how the technical and logistical problems will be addressed, as well as the process for compensation for implementing track and trace.

“Wholesalers have also faced huge uncertainty around the future of the scheme post-Brexit and the next No Deal deadline coincides with deadlines for compensation claims which adds to the confusion. The Government needs to answer the questions tobacco traders have as soon as possible as well as provide clarity about what will happen to the scheme after we leave the EU.

“We are particularly concerned that funding for the scheme appears in some cases only to cover implementation, rather than the full costs to a business of meeting their obligations. We have asked for assurance from HMRC that tobacco manufacturers will provide and maintain the necessary equipment over the entire lifetime of the regulations.”

James Lowman, ACS chief executive, said: “The introduction of track and trace regulations has required retailers to make significant operational changes, and it has been an ongoing battle for our members against limited and unclear information from the Government and the bodies appointed to manage the scheme, and against incomplete and inadequate systems.

“The regulations have been in place for over six months now but there are still plenty of unanswered questions about how they work in practice, leaving retailers in fear of unwittingly being on the wrong side of the law, as well as bearing additional costs in the long term. We need clarity from Government as soon as possible.”

The track and trace regulations introduced in May require all retailers who sell tobacco to apply for both economic operator and facility identifier codes. To benefit retailers applying for track and track codes, ACS produced a step-by-step guidance which has been downloaded more than 16,000 times.

The full guidance is available here.

ACS FWD Government HMRC James Bielby James Lowman track and trace wholesale