Monday , March 25 2019

UK unveils tariffs for a no-deal Brexit ahead of key vote

Bloomberg

The UK will avoid imposing tariffs on most imported goods in the event of a no-deal Brexit, though officials said prices of key Eu-ropean Union products including beef, cheese and cars will rise.
The government said on Wednesday its “balanced approach” aims to offset a spike in prices that consumers would experience in a no-deal departure as a result of the falling pound and higher costs of imports. But a major UK business lobby described it as a “sledgehammer” for the economy.
The announcement comes after Parliament overwhelmingly rejected Prime Minister Theresa May’s Brexit deal for a second time, and lawmakers were expected to vote on Wednesday to rule out leaving the EU without a deal — a scenario the premier herself accepted would cause “damage” to the UK Revealing the government’s no-deal planning so close to the vote will be seen by many MPs as a strategy to focus minds.
“This is no way to run a country,” Carolyn Fairbairn, director general of Confederation of British Industry, told the BBC. “What we are potentially going to see is this imposition of new terms of trade at the same time as business is blocked out of its closest trading partner. This is a sledgehammer for our economy.”
The government also said any tariffs won’t apply to goods imported into Northern Ireland from Ireland. There will be a “temporary, unilateral approach” that wouldn’t require checks at the Irish land border.
According to the Temporary Tariff Regime, 87 percent of goods by value will be eligible for tariff-free access, compared with 80 percent currently. The remainder, including some meat and dairy, as well as finished cars, will be subject to tariffs to protect domestic industry. The list doesn’t include car parts imported from the EU.
The UK will also retain existing tariffs in areas including fuel and ceramics as a protection against “unfair global trading practices,” such as dumping.
The rates proposed by the UK would be lower than currently set by the EU in many areas, ranging from 60 percent of the EU’s most-favored nation rate for poultry meat to 13 percent of the rate for cheese. On finished cars and trucks, the UK would apply a 10.6 percent tariff, compared to the 11.3 percent the EU charges most-favored nations.
On textiles, the UK would apply 0.9 percent, compared to EU’s 8 percent. And foot-wear, on which the EU applies an 8.2 percent tariff, would be tariff-free into the UK.

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