ENG-1997 — Page 360

PUBLIC ORDER

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The department enforces legislation to safeguard the integrity of Hong Kong's trade (see also Chapter 7).

Revenue Collection

The department collects revenue from four categories of dutiable commodities: alcoholic beverages, tobacco, hydrocarbon oil and methyl alcohol. In 1997, it collected $8.74 billion in revenue from dutiable commodities, representing an increase of 6.2 per cent over 1996.

The department also assesses the taxable values of motor vehicles under the Motor Vehicles (First Registration Tax) Ordinance for the purpose of levying first registration tax. In 1997, the Motor Vehicles Valuation Group registered a total of 136 motor traders and assessed the provisional taxable value on 66 931 vehicles.

Prevention of Revenue Evasion

Cigarette smuggling continued to be a priority in the department's enforcement effort. In 1997, the department brought 1 616 cases to court and seized 132.3 million cigarettes with a duty potential of $95 million.

The illegal use of industrial diesel oil has been one of the department's major challenges and it has strengthened the manpower of the Diesel Oil Enforcement Division to deal with the syndicates involved. Legislation has been amended to increase the maximum penalty for offences relating to the marking and the detreatment of diesel oil marking to two years' imprisonment and a $200,000 fine the same level as that for offences relating to the illegal use of marked oil. The department has also adopted two new measures against the misuse of marked oil, i.e. to take the fingerprints of all diesel oil offenders and to seize vehicles involved in more than one offence. As a result, the number of cases of misuse of marked oil has dropped significantly. The department has consequently been able to focus its attention on diesel oil smuggling.

During the year, the department detected 27 smuggled diesel oil cases compared with four in 1996. Positive results have come from the Oil Industry Reward Scheme, sponsored by five major oil companies, which rewards those providing information about illegal diesel oil cases. In 1997, the department detected 286 illegal filling stations and 14 oil detreatment plants where markers and colouring substances were removed from marked oil. In all, 2.2 million litres of diesel oil with a duty potential of $6.5 million were seized and 1 024 persons were arrested.

Anti-narcotics Operations

The department continued to take vigorous enforcement action to prevent and suppress unlawful trafficking in dangerous drugs and their manufacture and distribution. To reinforce this effort, it also enforced the Control of Chemicals Ordinance which aims at preventing the diversion of chemicals for the illicit manufacture of dangerous drugs and psychotropic substances.

The Customs Drug Investigation Bureau is the department's major investigative arm. Its main functions are to conduct investigations and surveillance in cases involving illegal trafficking or use of drugs. The department worked closely with the Hong Kong Police Force, various provincial Public Security Bureaux in the mainland

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