The greatest risk to the revenue is that persons who ought to be
paying duty will, through ignorance or design, avoid bringing
themselves to our attention by failure to notify. The other major
risk is that gas ostensibly for non-dutiable use may be diverted to
road fuel use. The proportion of gas used for road fuel is very
small compared to the amount put to non-dutiable uses (e.g. heating
and cooking) and is on such a scale that diversions to road fuel
use are difficult to detect. When making audit visits or approving
the form of traders’ records officers should be aware that a
person involved in the distribution or use of gas as road fuel who
has ready access to other stocks of gas represents a particular
revenue risk.
As with any instance of diversion of gas to road fuel use
there is also a VAT implication. Gas used as heating fuel currently
has a lower rate of VAT than for gas used as road fuel (
VAT Notice 701/19 Fuel and Power).
Liability to duty
To ensure traders fulfil their responsibilities for charging
and accounting for the duty, officers should encourage trader
compliance and ensure duty is charged at the earliest possible
stage and on all the relevant stock.
