BREXIT

BRITAIN has threatened to impose customs duties and VAT on all goods coming from Europe if the EU blocks a trade deal.

Brexit Secretary David Davis warned Brussels it would suffer if trade is disrupted as EU countries sell 60billion euros more in goods and services to us than we do to them.

Ministers set out post-Brexit plans that would allow lorries to clear customs checks at Channel ports within seconds thanks to an online border system and number-plate recognition technology.

However, they said MPs and peers will legislate to impose new customs duties and VAT tariffs on trade with the EU, in case no Brexit deal can be agreed by March 2019.

In the first of 12 documents setting out its negotiating position, the Government said that if there is no deal, ‘the UK would treat trade with the EU as it currently treats trade with non-EU countries’.

‘Customs duty and import VAT would be due on EU imports,’ it said. ‘Traders would need to be registered. Traders exporting to the EU would have to submit an exploration declaration, and certain goods may require an export licence.’

But the document said it hoped for a deal with the EU and set out two customs options – a streamlined customs arrangement or a new customs partnership.

Under the first proposal, Britain and the EU would use technology to help goods pass speedily through ports.

Mr Davis said they would replicate techniques used for products coming from outside the EU, which ‘get 90 per cent of containers through in a matter of seconds’.

Companies would fill out customs declarations using an online system in advance, with number-plate recognition allowing vehicles to be waved straight through. Spot checks would affect only a small proportion of lorries. The second proposal, for a new customs partnership, would see the EU’s customs rules mirrored by the UK so that ‘all goods entering the EU via the UK have paid the correct EU duties’.

‘This would remove the need for the UK and the EU to introduce customs processes between us, so that goods moving between the UK and the EU would be treated as they are now for customs purposes,’ the document said.

Holidaymakers would face no extra checks under either option, the Government said, and people on so-called ‘booze cruises’ to France would not be affected.

Brussels said it would not begin discussing the UK’s proposals for customs until more progress is made in negotiations on the Brexit divorce bill.

However, Mr Davis reminded EU countries it was in their interest to reach a mutually beneficial arrangement.

‘We sell about 230billion euros of goods and services to the EU each year, they sell 290billion to us. I was in Bavaria only two or three weeks ago. They sell BMWs, they sell agricultural produce, they sell electronic goods.

‘They have got an incredibly strong interest in something like this, so there is an interest on both sides of not doing each other harm.’

Michel Barnier, The EU’s chief Brexit negotiator, tweeted: ‘The quicker the UK and EU27 agree on citizens, settling accounts and Ireland, the quicker we can discuss customs and the future relationship.’

A European Commission spokesman said: ‘We take note of the UK’s request for an implementing period and its preferences as regards the future relationship, but we will only address them once we have made sufficient progress on the terms of the orderly withdrawal.

‘An agreement on a future relationship between the EU and the UK can only be finalised once the UK has become a third country … frictionless trade is not possible outside the single market and customs union.’

Guy Verhofstadt, the European Parliament’s chief Brexit co-ordinator, also took to Twitter and wrote: ‘To be in and out of the customs union and [have] “invisible borders” is a fantasy. First need to secure citizens’ rights and a financial settlement.’

Mr Davis said he did not expect the Brexit divorce bill to be agreed this year.

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. Britain to demand no barriers at Irish border

The British Government has said that no check points or CCTV cameras should be put on the border between Northern Ireland and the Republic after Brexit.

Ministers have said their top priority is keeping the frontier free of border posts and have made clear there will be ‘no return to the hard borders of the past’.

In a paper, the Government said that Brussels could agree to there being no checks on goods crossing the border.

Under one proposal put forward, small businesses that make up 80 per cent of cross-border trade would be exempted from customs rules.

Larger companies would be trusted to declare what goods they are carrying between the two countries, with spot checks taking place away from the border.

Another option would see the Government work with Brussels on a special customs agreement that would eliminate checks on goods moving between any EU country and the UK.

The Government paper dismisses any suggestion a customs border could be shifted to the Irish Sea with checks and tariffs only at entry and exit points between the island and Great Britain.

Creating such a barrier between Northern Ireland and the rest of the UK is ‘not constitutionally or economically viable’, it says.

It also makes clear that the UK plans to protect the Common Travel Area – the open borders agreement predating our EU membership – that allows British and Irish citizens to move freely around the two countries. A Government source said: ‘Both sides need to show flexibility and imagination when it comes to the border issue in Northern Ireland and that is exactly what our latest position paper will do.

‘As [the EU’s chief Brexit negotiator] Michel Barnier himself has said, the solution cannot be based on a precedent so we’re looking forward to seeing the EU’s position paper on Ireland.

‘But it’s right that as we shape the unprecedented models, we have some very clear principles.

‘Top of our list is to agree upfront no physical border infrastructure – that would mean a return to the border posts of the past and is completely unacceptable.

‘Our paper sets out some creative options on customs … Protecting trade is vital for the UK and Ireland … so we’re prioritising finding a solution that protects businesses’ ability to access these important markets.’

The Irish government has welcomed the UK’s position paper. A spokesperson said: ‘Protecting the peace process is crucial and it must not become a bargaining chip in the negotiations.

The spokesperson added that the publication of the position paper was ‘timely and helpful’ as it offers more clarity.

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