United Kingdom plans to reverse the reduction of import tariffs after Brexit

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Last updated: 07 February 2020, 07:42 GMT

The government is preparing to reverse plans suggests last year to chop import tariffs on most goods coming to the united kingdom under proposals for post-Brexit trade agreements.

The Department for International Trade has opted to simplify the present regime instead of abolish large parts of it, as Theresa Mays government planned under a short lived scheme to follow a no-deal Brexit.

The trade secretary, Liz Truss, said she would consult business groups on whether the govt should simplify its tariff policy, which she said would ensure greater choice and lower prices for consumers.

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Truss said the aim of the review was to simplify and tailor tariffs to suit UK businesses and households, such as removing tariffs of but 2.5% and rounding tariffs right down to the closest 2.5%, 5% or 10% band.

Goods like fire extinguishers, pencils, bicycle pumps and a few household fridges currently have tariffs below 2.5%, which could , under the proposal, be removed.

Ministers also are seeking views on whether to get rid of tariffs on components utilized in factory production to undertake to scale back costs for UK manufacturers.

Last year the govt said 87% of imports into the united kingdom wouldn't attract a tariff once the united kingdom was outside the EUs single market and union , leaving large parts of the agricultural sector facing being undercut by cheaper foreign imports.

Truss called on UK businesses to assist shape Britains import tariff policy, which can apply from next year because the country prepares for all times outside the EU. She said she wanted to listen to from businesses during a four-week consultation from 5 March before replacing EU tariffs that remain effective for the remainder of this year.

Import tariffs on goods under the newest scheme will apply to countries where the united kingdom government has thus far did not put alternative trade arrangements in situ .

But Truss immediately saw criticism from the Institute of Directors for reviewing national trading policy while the govt and business groups were involved in trade negotiations with the EU and therefore the US.

Allie Renison, the IoDs head of national trading policy , said: The consultation comes at a fraught time as we seem headed for simultaneous negotiations with both the US and EU. this may leave business scrambling to figure outhow one set of negotiations will affect terms of trade with the opposite , and underscores the necessity for max clarity across all negotiating objectives to permit firms any hope of preparing beforehand .

Truss said submissions from business groups would help shape the governments new most-favoured nation tariff regime, which might be referred to as the united kingdom global tariff. this might include simplifying tariffs and removing them entirely on goods where Britain has no domestic production.

It is vitally important that we now move faraway from complex tariff schedule imposed on us by the ecu Union, she said. This is our opportunity to line our own tariff strategy that's right for UK consumers and businesses across our country.

The Department for International Trade wants to radically simplify the tariff system inherited from the EU, which has mushroomed over the past 50 years.

The UK is party to approximately 40 trade agreements that the EU has with about 70 countries, which together account for quite 14% of UK trade.

If these aren't replicated as deals with the united kingdom by the time Brexit occurs, their benefits will cease to use to UK businesses. So far, 20 rollover agreements are signed with 48 countries, accounting for about 8.5% of UK trade.

In a separate written statement to the Commons, Truss said the united kingdom would drive a tough bargain in its trade negotiations and was prepared to steer away if that's within the national interest.

She said it had been one among the governments key priorities to deepen trade and investment relationships with like-minded partners, starting with the US, Japan, Australia and New Zealand.