Minister rejects fuel tax cut appeal

Illegal fuel laundering is major criminal money spinner

Security minister Jane Kennedy has said she is "not convinced" cutting fuel duty in Northern Ireland would have an impact on organised crime.

On Wednesday a House of Commons committee published a report saying reducing the tax would help to tackle fuel smuggling and laundering.

The current price of fuel in the Republic of Ireland is lower than that in Northern Ireland - with excise duty on petrol 20p per litre cheaper on petrol and 25p per litre on diesel in the Irish Republic.

Large amounts of illegal fuel are smuggled across the border into Northern Ireland.

Jane Kennedy said cutting tax would not thwart criminals

But Ms Kennedy said if fuel taxes were cut organised criminals would just adapt to another form of profit making.

"The question of tax differentials between Northern Ireland and the Republic of Ireland have been raised many times before," she said.

"I don't think it would stop the criminals engaging in tax evasion on fuel. And it wouldn't stop the laundering of fuel.

"Our objective is to disrupt what they are doing and confiscate the profits they are making as a result."

Ms Kennedy made the remarks while launching a Christmas appeal to the public not to buy counterfeit goods like CDs, DVDs and videos, which she said were also funding paramilitary groups.

Recommendations

In its report on Wednesday the Northern Ireland Affairs Committee said the profits made were helping to "sustain terrorism".

The committee's report said: "It is within the Treasury's power to mitigate a significant source of paramilitary and organised criminal finance by reducing fuel duties in Northern Ireland.

"Decisive action is needed now in order to stem the tide of lawlessness and bring about lasting economic stability in Northern Ireland."

The committee added: "We are therefore calling on the Government to carry out a full cost-benefit analysis of the effects of the differential on Northern Ireland, as a prelude to setting a separate, lower, rate of fuel duty for Northern Ireland which would go some way towards mitigating the unique problems that have arisen."