No deal Brexit to see high street prices fall as import tariffs scrapped for a year

The government announced on Tuesday morning the UK has set out a temporary tariff regime to apply in the event of a no deal Brexit. The treasury was hoping to keep tariffs low if the economy became chaotic following the UK’s departure from the bloc. Conor Burns, trade minister, said in the event of a no deal exit on October 31, the emergency tariff schedule would be “subject to an ongoing review”.

A draft no deal tariff schedule was published in March.

It applied import duties to 13 percent of goods, including some meat and dairy products, vehicles, ceramics and fertilisers.

These aimed to support farmers and manufacturers.

But after lobbying by various industry sectors, Liz Truss, international trade secretary, recent announced some changes to the original tariff plan.

This included higher tariffs to protect companies making bioethanol.

There were also cuts on the proposed tariffs for HGVs entering the UK market.

This came after the haulage industry said the original plan would add £15,000 to the cost of the average truck.

Ms Truss argued that the “temporary” tariffs should be higher as it would be harder for the UK to negotiate trade deals with developing countries if it had already removed its tariff barriers.

A trade department official said: “Once you’ve cut tariffs to a very low level, even on a temporary basis, it would be hard to put them back again.”

Canada is one of many countries now reportedly reluctance to negotiate a new trade deal with the UK.

This is partly because it believes it will be able to export to Britain with low or zero tariffs if there is a no deal Brexit.

Mr Burns also told MPs on Monday the UK would not levy tariffs on goods entering Northern Ireland from the Republic of Ireland in a no deal exit.

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This is because it would open up an “obvious entry point to the UK market for any trader wishing to avoid the duties”.

The farming sector and ceramics industry are said to be angry about the latest tariff proposals though.

They say exporters selling into the EU market would be hit by a steep increase in tariffs.

But importers would pay lower rates or even nothing at all to sell to the UK.

Minette Batters, president of the National Farmers’ Union (NFU), said the government had “betrayed” the industry.

She said in a statement: “The prime minister has missed a real opportunity to back British farmers.”

The NFU also said egg, cereal and many dairy farmers, along with horticultural growers, would have “zero protection against cheap imports coming in from around the world.”

Stephen Phipson, head of Make UK, which represents British manufacturing, added the tariff regime had been created to protect consumers if the value of sterling plummets after Brexit,

He said the plans are set to hit exporters hard.

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