Wednesday, 4 April 2012

Metal Theft | Cashless exemptions | Alchemy Metals response.

Following considerable correspondence with the Home Office it came to light that yes indeed, this is a limited exemption. I have spoken to some 14 different Councils over the last few days in order to try and identify how many registered Itinerant Collectors had this exemption in place and was able to identify precisely none. (Please do also note that the Councils we spoke to were not at all in support of this exemption and in the case of the larger ones simply not geared up to handle an influx of applications). This in and of itself sounds like good news and indeed, on the surface of it, perhaps we should have little concern about a limited exemption, however:

a) Birmingham would normally see 10 or so new Itinerant Traders registered within a one year period, in the last few days they have had 12 new applications, admittedly only for Itinerant Trader status but this is simply due to the fact that at this point it is not well known that this is a very limited exemption and they may only continue cashless with the S3(1) in place.

b) As soon as Itinerant Traders realise this exemption is available they will be applying for it.

c) There are a very low number of Police prosecutions for metal theft at this point, this is of course an improving picture however for many Itinerant Traders who have simply not been caught so far, this exemption will be granted.

d) This exemption does not allow them to just go cashless - the original purpose of the S3(1) was to exempt them from keeping a register of whom they have bought from and the materials they have bought- this means that every single Itinerant Trader that has this exemption in place will be able to purchase for cash with absolutely no traceability. No cash and no traceability are not acceptable, by the time the materials make their way into a registered scrap metal dealer the stolen materials are already laundered, we have no way of knowing where they have come from or indeed, if they were questionable in the first place.

e) Within registered scrap metal dealers themselves we fully expect those that are so inclined to take full advantage of the situation by employing Itinerant Traders to continue paying cash.

f) We are a fairly specialist merchant, we only buy from manufacturers and from local traders such as plumbers, electricians etc., We do not buy from itinerant traders at all as we insist on knowing the provenance of all our materials. Around 10-15% of the manufacturers that we buy from are receiving cash for their materials, full traceability at our end however it is fair to say that a number of those will be avoiding taxes on their scrap. Itinerant Traders are a real threat to us as with this exemption in place we are unable to continue paying cash therefore Itinerant Traders will have a distinct commercial advantage.

g) A completely cashless system benefits HMRC greatly, we need to be in a position to tell our Manufacturers that cash is no longer available (from anybody), this exemption does not allow us to do that as it simply means cash is no longer available from us. Please do note that there are many Dealers such as ourselves whose core business is at threat with this exemption.