Companies that imported networking equipment from outside the European Union (EU) between 1995 and 2000 could be owed part of an estimated £300m in overpaid duty.
In a court case brought by Cabletron last year, the firm successfully argued that Lan data networking hardware should not be subject to the same import duties as telecoms equipment.
Customs & Excise had grouped Lan networking equipment with Wan kit as telecommunications equipment, thus imposing a 7.5 per cent duty. Cabletron argued it should have been classed as computer peripherals, rather than telecoms hardware.
"The networking industry has experienced some considerable downturn in the past few months, and this decision is a welcome tonic," said Steve Cock, a director at tax consultancy The Custom House.
"This represents a fantastic opportunity to reclaim customs duty that should never have been paid," he added.
"This doesn't surprise me," said Manny Pinon, sales director at networking distributor Norwood Adam.
"I can certainly believe all this because of the aggravation we have had when importing and exporting goods at different VAT rates. It is incredibly complex to keep track of all of the transactions," he said.
Not only are tariff classifications variable depending on the product being imported, but duty reliefs are also available if the product is re-exported, used in the manufacturer of another product, or imported from a country that has a prefential relationship with the EU.
Only £8m of the estimated £300m has been claimed so far. It is understood that only the Netherlands has offered full recovery of the duty within the EU.
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