The government has announced that most imports into the UK would not attract a tariff in the event of a no-deal Brexit. 87 per cent of imports by value would be eligible for zero-tariff access.
Under the ‘temporary and unilateral’ no-deal plan, EU goods arriving from the Republic of Ireland and remaining in Northern Ireland will not be subject to tariffs but any goods moving from the EU into the rest of the UK will be hit by a schedule of rates released today.
At the moment 80 per cent of imports are tariff-free. Tariffs would be maintained to protect some industries, including agriculture. Beef, lamb, poultry and some dairy products would receive protection.
Cutting import tariffs on imported goods would ease the hit to British consumers from an expected jump in inflation in the event of a no-deal Brexit which would probably cause sterling to tumble and make imports more expensive.
It would also expose British manufacturers to cheaper competition from abroad and, if maintained, low or zero tariffs would deprive the UK of ammunition for extracting concessions from other countries in future trade talks.
However, under the plan, the UK car industry will receive some protection, with some imported cars attracting tariffs. But car parts from the EU would be tariff-free, which will help car plants in the UK.
Trade Policy Minister George Hollingbery said: “Our priority is securing a deal with the EU as this will avoid disruption to our global trading relationships. However, we must prepare for all eventualities.
“Our priority is securing a deal with the EU as this will avoid disruption to our global trading relationships. However, we must prepare for all eventualities.
“If we leave without a deal, we will set the majority of our import tariffs to zero, whilst maintaining tariffs for the most sensitive industries.
“This balanced approach will help to support British jobs and avoid potential price spikes that would hit the poorest households the hardest.”
Britain, Ireland and the EU have said they want to avoid physical checks on the border, which was marked by military checkpoints before a 1998 peace deal ended three decades of violence in the region. But both disagree on the ‘backstop’, or insurance mechanism, to exclude such border checks.