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British Retailers Set Out UK Free Trade Deal Wishlist

by Jason Gorringe, Tax-News.com, London

27 December 2017


The British Retail Consortium has set out the free trade deals of most value to its members and consumers, with the UK set to lose access to EU free trade agreements unless the UK immediately concludes replica deals upon exiting the European Union.

The BRC pointed out that, as a member of the EU, the UK currently benefits from zero or low rate tariffs on various imports from trade deals that the EU has negotiated with third countries. From the day after the UK leaves the EU, on March 30, 2019, the UK will no longer be covered by these international agreements, so imported goods will be subject to higher tariffs and potential customs barriers. For consumers this will mean higher prices.

As the UK is precluded from negotiating bilateral free trade deals until it officially leaves the European Union, the UK Government has instead indicated that it will seek to agree bilateral trade deals that could be implemented immediately after leaving the EU that would mirror the existing deals it is party to through its EU membership.

Using import data from UK retailers, the BRC has identified the countries where negotiating replica trade agreements will make the most difference to ensure prices don't rise immediately on exit. These deals are particularly important for the price of food and clothing for UK shoppers, it said. For instance, in the event of a no deal, the tariff on clothing from Turkey, a major supplier to the UK, could rise from zero to 12 percent; fish from Iceland would see tariffs rise from 3.4 to 11 percent, and Norwegian fish import tariffs would rise from 5.2 percent to 11 percent.

Egyptian fruit would face tariffs of 13 percent, up from 2.6 percent; Moroccan vegetables would face a 13 percent tariff, up from 0.8 percent; Chilean and Peruvian fruit would face a tariff of 13 percent, up from 1.7 percent and 1.5 percent, respectively.

Andrew Opie, Director of Food and Sustainability at the British Retail Consortium, said: "While securing a deal with the EU to enable tariff-free trade to continue remains the priority, the deals the EU has negotiated with countries around the world also contribute to the choice and affordability of goods that UK shoppers purchase every day. People need reassurance from Government that these deals will be transferred in time to ensure that UK consumers don't lose out."

"New or higher tariffs inevitably mean consumers would face higher prices in their everyday shop, as staple products such as fruit, vegetables, fish, and clothing would be hardest hit. Price increases of any scale would add to the burden of hard-pressed consumers whose finances are already being squeezed by inflationary pressures."

"Now that an agreement has been reached to move the negotiations on to trade, the focus must be on securing the continuity of free trade with Europe, alongside replicating these existing agreements with countries outside of the EU. These are the crucial next steps that Government needs to take to avoid a cliff-edge situation on Brexit day and to deliver a fair Brexit for consumers."

TAGS: Morocco | Chile | Iceland | tariffs | Norway | food | agreements | Egypt | Peru | retail | trade | inflation | Turkey | Europe

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