Soft Drinks Industry Levy: Movement between the Isle of Man and UK
Published 29 October 2018
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This publication is available at https://www.gov.uk/government/publications/movement-of-soft-drinks-between-the-isle-of-man-and-uk-under-soft-drinks-industry-levy/soft-drinks-industry-levy-movement-between-the-isle-of-man-and-uk
Who is likely to be affected
Businesses currently liable to register in the UK for the Soft Drinks Industry Levy as a result of moving liable soft drinks from the Isle of Man to the UK.
Businesses that have paid the levy on liable soft drinks in the UK that are currently exported to the Isle of Man.
General description of the measure
This measure will mean that the movement of liable soft drinks between the UK and Isle of Man will not be seen as either an import or an export under the levy, as long as the levy rates of the UK and Isle of Man remain aligned.
It also adds the levy to the list of common duties of the UK and Isle of Man.
Policy objective
This measure will help reduce the administrative burden on businesses moving liable soft drinks from the Isle of Man to the UK by removing the requirement to register for the levy as importers.
Adding the Soft Drinks Industry Levy to the list of common duties of the UK and Isle of Man brings the levy in line with VAT and other Indirect Taxes. It facilitates the sharing of revenue and administrative co-operation and enforcement for the levy between the UK and Isle of Man.
Background to the measure
This measure was announced at Budget 2018.
The Soft Drinks Industry Levy was announced at Budget 2016 and commenced on 6 April 2018.
A consultation document (Soft Drinks Industry Levy) was published on 18 August 2016. The government’s response to this consultation was published on 5 December 2016.
Detailed proposal
Operative date
This measure will have effect from 1 April 2019.
Current law
Current law relating to the Soft Drinks Industry Levy is contained in part 2 of the Finance Act 2017 and the Soft Drinks Industry Levy Regulations 2018.
Current law relating to revenue sharing, administrative co-operation and treatment of goods traded with the Isle of Man is contained in the Isle of Man Act 1979.
Proposed revisions
Legislation will be introduced in Finance Bill 2018-19 amending section 1 of the Isle of Man Act 1979 to include the Soft Drinks Industry Levy in the list of common duties.
A new section 58A will be inserted into Finance Act 2017 to provide that movement of liable soft drinks between the UK and Isle of Man will not be treated as an import or export under the Soft Drinks Industry Levy, unless UK and Isle of Man have adopted different levy rates.
Summary of impacts
Exchequer impact (£m)
| 2018 to 2019 | 2019 to 2020 | 2020 to 2021 | 2021 to 2022 | 2022 to 2023 | 2023 to 2024 |
|---|---|---|---|---|---|
| - | negligible | negligible | negligible | negligible | negligible |
This measure is expected to have negligible impact on the Exchequer.
Economic impact
This measure is not expected to have any significant economic impacts.
Impact on individuals, households and families
There is no impact on individuals because it only affects liable soft drinks packagers and importers registered for the levy in the UK.
The measure is not expected to impact on family formation, stability or breakdown.
Equalities impacts
It is not anticipated that there will be any impacts for groups sharing protected characteristics.
Impact on business including civil society organisations
This measure will ensure that any movement of liable soft drinks between the UK and the Isle of Man is treated as being a movement within the UK for the purposes of the levy.
This means that businesses will not be classed as ‘importers of soft drinks’ and would not therefore be liable to register for the levy, decreasing the administrative burden on those businesses.
Business in the UK that are liable to pay the levy on liable soft drinks will no longer be able to claim an export credit when those liable soft drinks are moved to the Isle of Man.
One-off costs include familiarisation with this new measure.
Operational impact (£m) (HMRC or other)
Operationally, this measure would decrease the burden on HMRC.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
The measure will be kept under review through communication with affected taxpayer groups.
Further advice
If you have any questions about this change, contact Ben Martin by email: benjamin.martin@hmrc.gov.uk.