Sunday 18 August 2019

Samantha McCaughren: Border Brexit woes gather pace as October deadline approaches

Concerned businesses in border areas have attended meetings with business minister Heather Humphreys
Concerned businesses in border areas have attended meetings with business minister Heather Humphreys
Samantha McCaughren

Samantha McCaughren

A little bit of Brexit panic is starting to rise in parts of the business community. While some companies took decisive action on their Brexit contingency plans some time ago, tens of thousands took the Government's lead and were slow to countenance a no-deal scenario. Gaps in preparedness are now clearly starting to emerge for companies, particularly in the Border counties.

And the worry is that Government agencies will not be in a position to help plug those gaps in time.

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Business minister Heath Humphreys, along with umbrella accountancy group the CCAB-I, hosted Brexit information sessions for members and businesses in Cavan and Monaghan over the last couple of weeks. Confusion and growing anxiety were evident.

One of the most pressing concerns raised by ordinary business owners was a lack of information on customs checks.

There is an acceptance now among firms that Brexit is going to happen and there will have to be customs checks. Companies want to know where checks are going to be. Several businesses attending the meetings deal in perishable goods, such as mushrooms. And they rightly want to know if the customs checks will necessitate new routes for drivers.

Will there be depots or designated areas for checks? Will there be delays? Will drivers have to work longer days? Will more petrol have to be factored into costs?

Some of these concerns might seem relatively minor to policymakers in Dublin, but they are bothering businesses around the Border and, with 16 weeks to go, surely they have a right to firm information?

Cróna Clohisey, manager for advocacy and voice with Chartered Accountants Ireland, attended the meetings and said that, unfortunately, the Government documents released last week offered little by way of reassurance.

Clohisey said: "It's a lot of the same information that we've seen before. And the one question we would like to have seen addressed was checks on the Border and where they will take place, because there are going to be checks. And that's disappointing from a business perspective because it doesn't allow them to plan."

Another flashpoint is goods processing, which is when products have to cross the Border for some finishing, or some other aspect of production. One of the highest-profile examples of this is Guinness, which passes back and forth across the Border twice before reaching stout drinkers.

One of the questions raised was if you process or finish goods in the UK, will you have to pay customs on the way out of Ireland, and then on the way in again?

There has been a misconception that customs would have to be paid twice in these circumstances. Revenue has been getting the message out there that outward processing relief addresses this problem.

But firstly, a company needs an EORI number and, as has been well-publicised, a worrying number of businesses have not yet applied for one ahead of Brexit.

A Revenue official will then arrange a visit to the business premises of the applicant to discuss the procedure, and to advise on the records to be kept. "It takes approximately 30 days from the date of acceptance of a fully completed application to issue an authorisation," Revenue said.

There have been eight applications since the start of the year, and six have to wait until the UK actually leaves the EU. You would have to imagine that many more applications are on the way. Is it little wonder that some accountants are very concerned about Revenue's capacity to deal with a significant increase in demand for such a certification?

Another concern raised at the Border meetings was the lack of attention on services, post-Brexit.

Will a plumber from Northern Ireland be able to work freely in the Republic? The focus has been on trade and goods across the Border, but Ireland has a huge non-financial services sector. And while there are no customs for services, there are Vat issues and licensing issues, and for many businesses, it remains very unclear how the UK exit will affect them.

Even if there is a Brexit agreement, thousands of businesses will have to file customs returns for the first time.

Specialist software is required to submit these declarations and some companies may wish to outsource this. However, anecdotally, there is word of a shortage of experts available to take on customs work, given demand for their services.

The message from small businesses has not changed in three years: they can't plan for the unknown. But with October 31 fast approaching, surely there is an onus on the Government to provide more certainty than this.

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