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Chair comments on Government publication of no-deal tariff plans

13 March 2019

Following the publication of the Government's no-deal tariff plans, the chair of the International Trade Committee, Angus Brendan MacNeil, said:

“It beggars belief that it's taken the Government until today, just 16 days before Brexit is due, to set out the UK's tariff regime in the event of a no-deal exit. It's unforgivable that businesses have been deprived of this crucial information until this late hour. And even now, they're being presented with plans about which there has been no prior consultation – and which raise at least as many questions as they answer.

“While a lot of tariff lines would be set at zero, there would still be new tariffs on some imports from the EU and from countries with which the EU has trade agreements that the UK has failed to roll over in time. This is likely to mean significant increases in the prices paid by UK consumers – for instance, as a result of the planned 10% tariff on car imports. Conversely, where tariffs are set at zero, the UK would effectively be giving away its bargaining position for negotiating post-Brexit trade agreements. Why would anyone grant us concessions on their tariffs if we've already got rid of ours?

“The Government says the planned arrangements are only intended to last for up to 12 months in the first instance. But a year is plenty of time for irreversible damage to be done to individual businesses and even whole sectors. And the Government's complete lack of clarity about what happens after 12 months just adds to the already crippling uncertainty which British businesses face.

“Of particular concern is the impact of the planned tariff regime on agriculture. While there will be some protection for UK agriculture, the tariffs will be set at a lower level than those from which we benefit within the EU – so UK farmers will potentially face new challenges from non-EU imports. UK farmers that export to EU countries will find their products suddenly on the wrong side of the EU's tariff wall.

“Another major area of concern is the plan to apply the no-deal tariff regime to Northern Ireland, which appears to have been drafted on the back of a fag packet. It looks like a smugglers' charter and could well be in breach of World Trade Organization rules. Moreover, it would be lopsided – while goods moving from the Republic of Ireland to Northern Ireland will not face tariffs, those going in the other direction will almost certainly do so.

The Government's plans also lack credibility regarding those industries that are vulnerable to unfair competition from subsidised industries in countries such as China. No tariff is planned in respect of steel – and my committee is very concerned that the new trade remedies arrangements, specifically to protect against unfair competition, will not be ready by 29 March.”

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