Amendment to the Customs and Excise Management Act (CEMA) 1979 — control of movement of aircraft into and out of the United Kingdom
Published 20 July 2022
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Who is likely to be affected
Aerodromes involved in movements of people and goods to or from the United Kingdom where those aerodromes are not designated customs and excise airports.
General description of the measure
This measure introduces legislative changes which:
a) put in place a process for the Commissioners for HMRC to grant, amend and revoke approval governing the movement of people and goods through aerodromes that are not customs and excise airports. Such approval may be subject to conditions and restrictions. The measure will include a route of appeal against decisions and penalties.
b) requires affected aerodromes to be approved and take responsibility for complying with their terms of approval.
Policy objective
This legislative change will establish an approval regime that will strengthen aerodrome operator accountability.
Background to the measure
Section 21 of the Customs and Excise Management Act (CEMA) 1979 controls the movement of aircraft carrying passengers or goods into and out of the United Kingdom and ensures that, unless permitted by HMRC, pilots only land at approved locations
Some locations are approved as designated customs and excise airports. Alternatively, HMRC permits pilots to land at aerodromes provided the aerodrome has a Certificate of Agreement (CoA) in place.
Designated customs and excise airports handle large volumes of passengers and goods and consequently are required to demonstrate a high standard of infrastructure and processing to manage customs controls. In contrast aerodromes generally handle small private jets with passengers and carry goods under a duty allowance, with no or very limited movements of freight.
The typical requirements placed upon customs and excise airports are not appropriate for these smaller locations. Instead, the government currently agrees a Certificate of Agreement with an aerodrome operator and this in turn provides the basis of the permission granted to the aircraft commander or importer to land at these locations. This legislative change will create an approvals process which makes sure a proportionate level of oversight and enforcement at these locations.
Detailed proposal
Operative date
This legislation will have effect on and after the date of Royal Assent to Finance Bill 2022-23. However, approvals under this legislation will not be put into practice until 1 January 2024 onwards. The government will work with impacted aerodromes to support them in the lead up to the implementation date.
Current law
Part 3 of CEMA governs the approval of areas for customs and excise purposes and regulates the movement of goods and people from such areas.
Part 4, paragraph 158 of Schedule 7 to the Taxation (Cross-border Trade) Act 2018 (TCTA) applies and modifies CEMA for the purposes of duty chargeable on certain movements of goods into Northern Ireland under sections 30A and 40A TCTA and into Great Britain from Northern Ireland under section 30C TCTA.
Proposed revisions
Legislation will be introduced in Finance Bill 2022-23 to provide for:
- a power for HMRC Commissioners to approve an aerodrome as a place for the loading and unloading of goods or embarkation and disembarkation of people
- a requirement for affected aerodromes to be approved
- the ability to specify conditions or restrictions that the approval will be subject to
- a right of appeal
- the ability to either revoke such approval or amend any conditions (or both) and restrictions
- the ability to impose penalties for breach of any conditions or restrictions
Summary of impacts
Exchequer impact (£million)
| 2022 to 2023 | 2023 to 2024 | 2024 to 2025 | 2025 to 2026 | 2026 to 2027 | 2027 to 2028 |
|---|---|---|---|---|---|
| Empty | Empty | Empty | Empty | Empty | Empty |
Costings, where required, will be subject to the scrutiny by the Office for Budget Responsibility and included in their forecasts at a future fiscal event.
Economic impact
This measure is not expected to have any significant economic impacts.
Impact on individuals, households and families
There is expected to be no impact on individuals as this measure only affects businesses, including individuals in a business capacity (such as employees). This measure is not expected to impact on family formation, stability or breakdown.
Equalities impacts
It is not anticipated that there will be impacts for those in groups sharing protected characteristics.
Impact on business including civil society organisations
This measure is expected to have an impact on aerodromes that are currently operating under a Certificate of Agreement as these changes formally place accountability on aerodrome operators for activities that fall within their remit. They will be subject to penalties for non-compliance which was not previously the case (save for the revocation of the Certificate of Agreement). Other impacts could include a one-off cost to include familiarisation with the changes or continuing costs in having to reapply for approval approximately every 5 years.
HMRC is working with external stakeholders to build awareness and capability across customs control to create a culture of compliance. The penalties are intended to be a deterrent and provide reassurance to compliant aerodromes.
This measure is not expected to impact civil society organisations.
Customer experience is expected to remain broadly the same as it will not significantly alter how compliant businesses interact with HMRC.
Operational impact (£million) (HMRC or other)
No impacts are anticipated.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
This measure will be monitored through information collected through Border Force and HMRC IT systems and will be kept under review through communication with affected taxpayer groups and other government departments.
Further advice
If you have any questions about this change, contact Claudette Thompson (Customs Policy and Strategy) by email: [email protected].