Extent of wine tax fraud remains a riddle to Customs

The latest estimates from HM Revenue and Customs saw the loss to the taxpayer from evasion of duty on spirits and beer soar more than 40 per cent to £1.2bn in 2009/10.

But that figure excludes wine sales – despite fears that the market is being targeted by fraudsters because of a successful crackdown on stronger alcohol.

The National Audit Office (NAO) welcomed “significant” improvements to HMRC’s anti-evasion efforts after it was strongly criticised in the past and noted some “early notable successes”.

But it found “no evidence” that the strategy had succeeded in stopping beer being sent abroad for export but then diverted back to the UK and called for action to quantify wine-based losses.

Officials were still unable to download information from an European Union database of food movements that would help to track illicit shipments, the NAO said.

It complained that HMRC had “no explicit objective” of pursuing more criminals through the courts with only six or fewer convictions secured in each of the four years to 2009/10.

The NAO also pointed the finger at other EU states which adopt “a more liberal interpretation” of a new anti-fraud regime.

It was the introduction of the EU single market and the ending of strict UK border duty levies which opened up many opportunities for criminals, such as shipping British-brewed drinks to countries with lower duty levels and then bringing them back illicitly.

The report said officials were unable to produce a reliable figure for duty dodged on wine because so much of it was imported and not produced in the UK.

Surveys of how much was drunk were regarded as unreliable.