Tuesday 16 July 2019

Brexit Q&A: From smuggling to taxes - what does it all mean?

  

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What is the UK plan for tariffs in the event of a no-deal Brexit?

The British government will cut to zero the tariffs on 87pc of imports to the UK.

But key industries will see taxes applied.

These industries include agri-products like meat, as well as shoes, cars and even underwear.

Does this mean prices will increase?

A number of consumer goods will be more expensive if a deal is not agreed. Of most concern is the impact on farm produce. It is expected beef will go up by almost 7pc which could cripple the industry here.

Tins of tuna could go up by 24pc while underwear made from synthetic fibre would be hiked by 12pc.

So that must mean a hard Border between Northern Ireland and the Republic?

No. The proposal makes an exception for goods travelling from southern Ireland to the North. There will be no customs checks or physical infrastructure on this island, and no tariffs on goods moving across the Border, no matter their place of origin.

Can these goods then move from Northern Ireland to the mainland UK without charges?

There will be no checks on goods crossing from the North to Britain. In theory, a product made in Dublin can be transported into Northern Ireland and then on to England without any customs checks.

What about goods moving from the Republic across the Irish Sea to the mainland UK?

These exports will be subject to the same tariffs as goods arriving in the UK from other parts of the EU.

What about smuggling?

The UK admits that the proposed regime could leave Northern Ireland vulnerable to smuggling.

Sources in Dublin said it would turn the North into a back-door route to Britain. If the situation becomes untenable the UK will consider upping checks at ports.

How long will the tariffs apply for?

The new tariff schedule would apply from 11pm on March 29 in the event of a crash out of the EU with no deal, and would be in place for up to 12 months.

What happens after 12 months?

That time will be used to negotiate an arrangement that maintains an open Border but doesn't leave the UK as exposed to smuggling. The EU says the answer already exists in the form of the backstop.

The UK says "a negotiated settlement is the only means of sustainably guaranteeing no hard Border and protecting businesses in Northern Ireland".

So, will the EU apply reciprocal tariffs?

The EU has refused to engage in an immediate trade war, saying it needs time to "analyse" the UK plan. European Commission spokesman Margaritis Schinas said: "Look to London, not Brussels, for answers."

What happens if the UK gets a Brexit extension?

In this scenario the can will be kicked down the road by months or possibly years while the politicians try to find a new way forward.

Irish Independent

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