A dramatic Guilty plea in tax case

Michael Kirk
Michael Kirk
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A WIGAN sales manager accused of a massive tax scam involving the smuggling of cheap Chinese-manufactured parts has dramatically changed his plea to guilty.

Michael Kirk (pictured), 42, of Middlecot Close, Orrell, had denied the charges, but after hearing two days of damning evidence at Croydon Crown Court he finally admitted his guilt.

Now he must wait to hear his fate. He has been bailed to return for sentencing on October 21 after admitting being knowingly concerned in the fraudulent evasion of duty payable on goods said to be from Japan between January 1, 2003 and July 31, 2006 and goods said to be from India between February 1, 2006 and January 31, 2008.

The parts were subject to a 58.6 per cent tax - nicknamed ‘anti-dumping duty’ - imposed to thwart importers unfairly undercutting rivals within the EU.

Prosecutor Mr Julian Christopher QC told the jury at the start of the trial “Smuggling comes in all shapes and sizes and one type is the smuggling of Chinese pipe fittings.”

To protect European manufacturers the European Commission agreed to impose the tax on carbon steel imports from China.

“The country outside the EU is dumping its products at an artificial price into the EU,” added the prosecutor.

The court was told between 2003 and 2008 Ashby Scott Ltd of Unit A, Shell Green Estate, Gorsey Lane Industrial Eastate, Widnes avoided more than £640,000 duty in relation to 31 importations the defendants claimed had come from Japan and India.

Company director John Sutton, 64, of Cheriton Mill, Cheriton Fitzpaine, Crediton, Devon and the company deny the charges and their trial continues.

“None of that was paid because the pipe fittings were not sent directly from China, but from Japan and later from India,” added Mr. Christopher. “The anti-dumping duty ought to have been paid.

“You will have to decide whether either defendant knew they were Chinese or thought they were from Japan or India,” he told the jury. “The prosecution say they knew full well they were Chinese.”

The parts were bought from APCO a Chinese/British venture involving a UK company called TFF International - of which Sutton was the managing director and nominated legal representative.

His company had invested $150,000 US into APCO and the Chinese $350,000 US and TFF agreed to handle all the marketing and imports and exports.

Kirk provided the documentation for Customs clearance with the full knowledge of Sutton, the prosecution allege.

“Through them the company was operating and through them it was importing pipe-fittings and dealing with shipping agents,” added Mr Christopher.

The parts were shipped from Dalian, China to Osaka, Japan then immediately re-shipped to Felixstowe and delivered to Ashby Scott Ltd.

The paperwork Kirk prepared tried to show the shipping containers were packed in Japan by Gosei Industries.

“That is all part of the smuggling, all part of the fraud.”