Nothing to declare! Duty-free limit could rise to [pounds sterling]1,000 - if the EU says Yes.

Byline: SEAN POULTER

LONG-HAUL shoppers who use trips abroad to stock up on cut-price luxury goods Coleen McLoughlin- style received hopeful news from the Chancellor yesterday.

Mr Brown is backing a 700 per cent rise in the value of goods which can be brought back to Britain without incurring a tax bill.

He is writing to the European Commission proposing that the tax-free limit on goods brought into the UK from outside the EU should rise from [pounds sterling]145 to [pounds sterling]1,000.

However, as with most of the Chancellor's preelection goodies yesterday, there is a catch.

Any decision to raise the limit will require a unanimous decision of all 25 EU members, which could be difficult to achieve.

The Brown initiative reflects the growing trend in shopping trips abroad, especially to destinations such as New York. And it would also help those who buy goods from the U.S. and Far East over the Internet.

Coleen McLoughlin, 19-year- old fiancee of Manchester United footballer Wayne Rooney, was collared by Customs officers at Manchester airport in October after a [pounds sterling]15,000 New York shopping spree.

She went through the 'Nothing to Declare' channel weighed down with Louis Vuitton suitcases.

The teenager was presented with a bill for around [pounds sterling]3,000 for her shopping bounty, which included designer clothes and platinum jewellery.

This was no doubt only a minor inconvenience for a girl who is said to receive [pounds sterling]100,000-amonth spending money from her boyfriend.

But a higher duty limit would be a major help to the large numbers of Britons who travel to the U.S. and Far East with not just a holiday but also a shopping trip in mind to take advantage of bargain prices on electrical gadgets, designer clothes and sportswear.

Currently, those found to be 'importing' new items worth more than [pounds sterling]145 from outside the EU can find they suffer searches, delays and a massive bill for duty and VAT. Similarly, more consumers are buying CDs and DVDs over the Internet from firms in the U.S. and Hong Kong.

Huge savings can be made on the British price of music and movies. But British customers, particularly if they place a large order, can be presented by the postman with a bill for duty.

At the moment someone buying a [pounds sterling]700 camcorder in the U.S. would be hit with import duty of up to 14 per cent, while on top of that would be another VAT bill of 17.5 per cent. That could take the tax bill to [pounds sterling]237.65.

The import duty element goes to the EU, while the VAT goes to the UK Treasury.

There are separate duty-free thresholds for tobacco and alcohol imported from non-EU states.

Mr Brown is not challenging these, which permit 200 cigarettes, or 100 cigarillos, or 50 cigars or 250g of tobacco.

Also allowed are two litres of still table wine, one litre of spirits, 60cc of perfume and 250cc of eau de toilette.

Customs & Excise has a helpline advising on import allowances and tax levels. It is 0845 010 9000.

Motoring

MORE than half of motorists are to face a [pounds sterling]5a-year hike in road tax.

The rises will hit family cars such as the Ford Mondeo and take the top rate of Vehicle Excise Duty to [pounds sterling]170.

The Chancellor announced he was to freeze fuel duty because of volatility in the oil markets - the third time he has done so.

But motorists will face an extra 1.22p a litre tax hike (5.5p a gallon) when the duty rise does kick in on September 1. Mr Brown told MPs that on the annual road tax 'there will be no increase for medium and small cars which are more environmentally efficient - almost half our cars.' Only larger more polluting cars would face an increase, he signalled. But the detail shows that owners of mainstream family saloons - including the Ford Mondeo and Vauxhall Vectra - will be hit by the [pounds sterling]5 tax rise.

Even many smaller cars such as some Ford Focus, Vauxhall Astra and Volkswagen Golf models will be affected.

Tobacco

THE price of a pack of 20 cigarettes rose by 7p - taking the average to around [pounds sterling]4.83 - from 6pm last night.

Mr Brown said the increase in duty on tobacco products was necessary 'for public health reasons'.

Duty on a pack of five cigars goes up 3p, taking the price to around [pounds sterling]4.11, while a 25g pack of hand-rolling tobacco will cost 8p more at around [pounds sterling]4.90.

Corner shops complained that the increases will drive away their customers, who will resort to cheaper illegal imports.

But the Government pledged to step up its efforts to prosecute professional smugglers and confiscate consignments of illegal cigarettes and handrolling tobacco.

It is feared that the expansion of the EU to 25 states last year has made it easier for gangs from Eastern Europe to target the UK.

Customs officials have been told to focus on organised gangs rather than 'booze cruisers' who go slightly over the allowed limit.

Alcohol

A PINT of beer will go up by 1p from midnight on Sunday, while duty on a bottle of wine rises by 4p.

The duty on spirits, cider and sparkling wine has been frozen.

The Campaign for Real Ale complained that the higher cost of a pint will be a blow to beer drinkers, who have already seen substantial price rises in recent weeks.

Chief executive Mike Benner said: 'This is a disappointing Budget for beer drinkers.

'A penny may not sound like much, but today's tax rise follows recent wholesale beer price rises by some brewers.

Some pubs will now be charging as much as 10p a pint more than they were only a month ago.

'At a time when beer consumption is falling and pub-going is in decline, this is a potentially devastating outcome for consumers and hardworking licensees.' Typical excise duty on a pint of beer will now be 35.8p, seven times the 5p figure in France.

The Budget changes are expected to add 1p to a small glass of wine in a pub.