Blog: Dean BestBrexit customs "could cost UK traders GBP4bn a year"

Dean Best | 11 September 2017

As the rain hammers on our windows this afternoon (11 September), a report in the UK offers companies doing international business some gloomy reading - post-Brexit customs could cost the country's traders GBP4bn a year.

The Institute for Government, a UK think tank set up to "increase government effectiveness", has published a report warning of the financial impact of the country leaving the EU's Customs Union.

The organisation said some 180,000 traders would need to make customs declarations after Brexit, the introduction of which it estimates could cost GBP4bn per annum.

"For these traders to be ready for exit, government must be clear about when and how they must adapt, and leave them enough time to do so. Until they are given some certainty on what is required from them on day one, the amount of this work that can take place is limited," the Institute said.

Of course, as yet, there is no clarity about what customs arrangements will be in place. Last month, the UK set out its ideas for the post-Brexit customs arrangements between the country and the EU, with London asserting the proposals would "avoid a cliff-edge" for businesses in both markets.

The UK government has said the country would not remain in the EU customs union when it leaves the bloc and put forward two models of how post-Brexit customs could look.

However, Guy Verhofstadt, the European Parliament's Brexit coordinator, described the UK's proposals as a "fantasy".

The Institute said today: "With 19 months until exit, there is no clarity on what customs will need to look like on day one of Brexit – currently 29 March 2019. The UK government has set out its preferences for an interim period and options for a future relationship with the EU, but each brings with it different implementation requirements. The EU will have its own position and until an agreement is reached, whether it is a transitional or final arrangement, government must continue to prepare for 'no deal', which means the most extreme change in the shortest period of time."

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