Alcohol fraud, tobacco smuggling, duty rises and the National Minimum Wage are the biggest barriers to growth in the wholesale sector, the Federation of Wholesale Distributors has told the Chancellor of the Exchequer.
In a submission to the Treasury ahead of next month’s Budget, FWD has highlighted the key restraints on its members, which between them manage the distribution of goods worth £28bn, employ 70,000 people directly, and supply 500,000 retailers, caterers and other private businesses. It also makes a number of recommendations that members believe would contribute to a strong and growing economy.
Alcohol duty fraud is costing the Exchequer hundreds of millions of pounds a year, FWD says, and is hurting legitimate wholesalers and retailers who cannot compete with fraudsters who are not paying duty on alcohol. It recommends the Government consults on robust measures to tackle alcohol duty fraud, including the introduction of duty stamps on beer.
FWD also calls on the Government to clamp down on tobacco smuggling, which is estimated to cost the UK taxpayer more than £4.1bn a year. This will boost revenue to the Exchequer and limit the economic impact the fraud is having on FWD members.
Duty increases on alcohol and tobacco should take account of the financial pressures faced by businesses including wholesalers, FWD argues, and asks the Chancellor to commit to an ongoing freeze in duty on fuel, and undertake a wider, long term review of fuel duty and its impacts on distributors and their customers.
It also recommends that the adult National Minimum Wage rate is frozen, to allow businesses to maintain or grow employment levels.
FWD chief executive James Bielby said: “Through their support for small businesses, our members make a huge contribution to the economy, and we are asking the Chancellor to commit to these recommendations which we believe will boost both the sector and the national economy.”