Update on UK Government no-deal announcements

On Wednesday the Government produced guidance on how it proposes to avoid a hard border between NI/Republic in a no-deal scenario, and the temporary tariff regime on imports that it would take forward.

Avoiding a hard border in a no-deal

  • This is a strictly unilateral, temporary approach to checks, processes and tariffs in Northern Ireland
  • The UK government would not introduce any new checks or controls on goods at the land border between Ireland and Northern Ireland, including no customs requirements for nearly all goods
  • The UK temporary import tariff would therefore not apply to goods crossing from Ireland into Northern Ireland. The Irish Government/EU has indicated it would not reciprocate the UK temporary import tariff
  • These measures, therefore, do not set out the position in respect of tariffs or processes to be applied to goods moving from Northern Ireland to Ireland
  • Goods arriving from Ireland would still be subject to the appropriate VAT and Excise duty as today and the UK government would continue to collect these taxes on Irish goods in future. VAT registered businesses would continue to account for VAT on their normal VAT returns
  • Small businesses trading across the border, not currently VAT registered, would be able to report VAT online periodically, without any new processes at the border
  • As an aside of this, Irish products entering the rest of the UK would face high tariffs - particularly on food
  • HMRC will have anti avoidance rule to discourage smuggling from IRE-UK-GB. But intelligence based enforcement, no systematic Irish Sea checks
  • UK government believe they will be acting within their rights as a WTO member to treat the border in this way. They have not ruled out using the ‘public morals exemption’


Temporary tariff regime (this only applies on goods coming from EU into NI via GB, not the Republic)

  • This regime is temporary, and the government would closely monitor the effects of these tariffs on the UK economy. It would apply for up to 12 months while a full consultation and review on a permanent approach to tariffs is undertaken
  • UK businesses would not pay customs duties on the majority of goods when importing into the UK if we leave the European Union without an agreement
  • Under the temporary tariff, 87% of total imports to the UK by value would be eligible for tariff free access
  • Tariffs would still apply to 13% of goods imported into the UK, predominately agri-food
  • The full list of tariffs is available here
  • However, for key construction related products, the temporary tariff would be…
  • Wood and wood products 0% (otherwise it would have been 2.2%)
  • Transport equipment 2.9% (otherwise it would have been 5.1%)
  • Machinery 0% (otherwise it would have been 1.9%)
  • Stone and cement 0.3% (otherwise it would have been 4%)
  • Mineral products 0.2% (otherwise it would have been 0.7%)
  • Chemical products 0.1% (otherwise it would have been 4.6%)
  • Plastics and rubber 0.1% (otherwise it would have been 4.5%)
  • Base metals 0% (otherwise it would have been 1.8%)
  • Aluminium 0% (otherwise it would have been 6.3%)
  • Steel and iron 0% (otherwise it would have been 0.8%) 

Obviously, taking account of the votes in the last few days, there is still a great deal of uncertianty as to what will happen. If you have any queries then please contcat David Fry on 028 9087 7143.