One particularly controversial (and worrying) technical notice confirmed how trade with EU countries would immediately change if the UK leaves the EU with ‘no deal’ on 29 March ‘19.
It set out a whole new range of red tape UK businesses would need to negotiate before trading with EU countries – like import and export declarations for all goods going across the border and separate safety and security declarations with the likes of Eurotunnel, airlines and shippers.
With no deal, Britain reverts to ‘third country’ status and importers will have to register for a UK Economic Operator Registration and Identification Number and submit declarations to HM Revenue and Customs. They would also have to classify their goods in relation to World Trade Organization tariffs and consider whether to hire staff and the services of customs brokers or freight experts.
Businesses are even being advised directly by the government to look into buying up warehouse space for goods awaiting customs approval – and says firms are likely to need to invest in new computer systems to track goods as well.
A potential VAT crisis was avoided, however, when the government said companies would be allowed to pay VAT on imports on their regular VAT returns, rather than upfront as the goods cross the border. It also says it will have a new Trade Remedies Authority up and running by 29 March to replace the European commission complaints procedure.
While some of the overall costs to the economy might be eased by increased trading opportunities with nations outside the EU, the end of free circulation of goods between the UK and EU is going to cost both businesses and consumers.
Quite simply, leaving the single market and the customs union without a deal means significantly higher barriers to trade with the EU – and higher costs for firms that are engaged in that trade.