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Home Topics Economy

Food costs could rise sharply without an EU-UK deal

UK sets out post-Brexit tariff regime

May 19, 2020
in In the news
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Price of food and cars from Europe will rise sharply if transition period ends without EU-UK trade deal

Tariffs on imported cars are designed to protect the UK car industry, but could lead to the price of imported vehicles rising by several thousand pounds © REUTERS

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According to the Financial Times, the price of food and cars imported to the UK from Europe will rise sharply under a new tariff regime set out by Boris Johnson’s government on Tuesday if the EU and Britain fail to reach a deal on their post-Brexit relationship.

The government guidance can be found here.

The agricultural tariffs are supposed to protect British farmers who are worried about a flood of cheap imports from overseas. Last week the Financial Times reported that UK cabinet ministers were in dispute over US demands for farm tariffs to be reduced to smooth the path to a US-UK trade deal.

Helen Dickinson, chief executive of the British Retail Consortium, warned that families would pay more for food. “UK consumers have become accustomed to a huge variety of affordable food thanks, in part, to tariff-free imports from the EU,” she said. “Unless a similar agreement is reached in the next seven months, imported agricultural products will be subject to new tariffs, raising costs for consumers.”

Nicholas Macpherson, former permanent secretary at the Treasury, said the economic case for Brexit had rested on free trade and cheap food. “Not for the first or last time, the Chamberlainite protectionists within the Tory party have defeated the Gladstonian liberals.”

In a move likely to be welcomed by environmental campaigners, tariffs on vacuum flasks, bike inner tubes and LED lights will also be slashed to zero.

The new system of tariffs will apply from January 2021 — when Britain’s post-Brexit transition period agreed with the EU expires — to imports from any countries with which it does not have a preferential trade deal, an agreement which grants special market access to specific nations.

More here…

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