No-deal Brexit: Tariffs to be scrapped on most imports as government finally reveals secret plan, putting UK jobs at risk

'Honesty box' at Irish border risks being smugglers’ paradise - and severe damage to Northern Irish farms and businesses

Rob Merrick
Deputy Political Editor
Wednesday 13 March 2019 08:33
What does a no-deal Brexit mean?

Tariffs will be scrapped or slashed on almost all imports after a no-deal Brexit – threatening job losses in UK firms – and there will be no checks at the Irish border, it has been announced.

The government’s secret unilateral plan was finally published just hours before MPs are given the chance to veto the UK crashing out of the EU without a deal.

Levies will still be charged on beef, lamb, pork and poultry and some dairy products, to protect UK farmers, and on some products including finished vehicles and ceramics.

But Carolyn Fairbairn, the head of the CBI employers’ organisation, described the situation as “a sledgehammer for our economy”.

The biggest change to tariff policy since the mid-19th century was “being imposed with no consultation with business and no time to prepare”, she protested.

Industry leaders fear being undercut by competition from emerging economies, such as China and Brazil, from which – unlike EU imports – tariffs are currently levied.

At the Irish land border, an “honesty box” will see businesses expected to self-report the movement of goods, with an online system for VAT payments.

The move is seen as the only way to avoid border posts and checks – despite the risk of a smugglers’ paradise and severe damage to Northern Irish farms and businesses.

But Stephen Barclay, the Brexit secretary, insisted the plan was a “modest liberalisation” and a “temporary measure” that would last while “we see what the real term consequences are”.

It is designed to stop shoppers being hit by higher prices, while protecting the most vulnerable sectors and increasing pressure on MPs to vote down a crash-out Brexit on Wednesday evening.

Before that, the strategy will also see Philip Hammond, the chancellor, use his Spring Statement to promise the release of billions of pounds of spending if the Commons changes its mind and passes Theresa May’s deal.

The proposed tariffs are set out as a proportion of the so-called “most favoured nation” (MFN) rates currently imposed by the EU on imports from countries which do not have a free trade agreement.

They are beef (53 per cent of MFN), poultry meat (60 per cent), sheep meat (100 per cent), pig meat (13 per cent), butter (32 per cent), Cheddar-like cheese (13 per cent), protected fish and seafood products (100 per cent) and milled and semi-milled products (83 per cent).

Tariffs on finished cars and trucks will be set at 10.6 per cent, down from the MFN rate of 11.3 per cent – but zero on car parts imported from the EU to prevent disruption to supply chains.

Officials said that the cutting of tariffs could have a small positive impact on GDP, although this would be dwarfed by the wider damage to the economy from leaving the EU without a deal.

George Hollingbery, the trade minister, said: “This balanced approach will help to support British jobs and avoid potential price spikes that would hit the poorest households the hardest.”

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