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Hospitality Today Magazine Customs Law Unreasonable Government Departments’ power and the discretion to use that power is again in question. The Angus Inn in Hastings has felt the full power of Customs in the pursuit of unpaid excise tax over which they had no control. The story so far is that a small distiller in Northland failed to pay excise tax and subsequently was liquidated with no means of paying the excise tax. Customs then pursued, as is their right, the excise tax from some of the retailers with which the distiller had been dealing. After long and extensive legal proceedings the right of Customs to pursue unpaid excise tax beyond the manufacturer to the retailer or indeed the consumer has been reinforced. It is hard to see any circumstances when such pursuit of excise tax could be considered fair unless the retailer or consumer knew the excise tax had not been paid. The way in fact excise tax is paid by manufacturers means that it is possible for a manufacturer to produce the product, sell it to a retailer and the retailer to have sold it, prior to in fact the manufacturer being required to pay the excise tax to Customs. Under these circumstances it is absolutely impossible for the retailer or the consumer to protect themselves against the failure of the manufacturer to pay their excise tax. New Zealanders are often told by their politicians that we can rely on the discretion of the authorities. The Police have recently been given that discretion as a result of the Smacking Bill. The experience at the Angus Inn however suggests that far more certainty is required in the rights of individuals where it relates to the power of Government and its agencies. The Customs Act should be amended to limit the power of Customs to pursue excise tax beyond the manufacturer, only when they can prove that the retailer purchased a product from the manufacturer knowing the excise tax had not been paid. The exercising of Government agencies discretion is brought into disrepute the first time it is used inappropriately. Unfortunately it appears that common sense can not be relied on. Bruce H Robertson |
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