The British Government has updated its temporary tariff regime to prepare for a no-deal Brexit. However, industry stakeholders think these measures will not be enough to protect small businesses.
The Government announced the new temporary tariff regime in March. It has now amended this slightly after listening to industry and consumer groups to attempt to ensure supply chains remain uninterrupted and to prevent price hikes following the UK’s exodus from the EU, no matter what form Brexit takes.
The updated temporary tariff regime includes three changes. Firstly, it will lower tariffs on lorries entering the UK. This, the Government hopes, will strike a better balance between the needs of British producers and the SMEs that make up the UK haulage industry, ensuring that crucial fleet replacement programmes that help to lower carbon emissions can continue
Secondly, the updates adjust the tariffs on bioethanol to retain support for UK producers, as the supply of this fuel is important to critical national infrastructure.
Thirdly, it will apply tariffs to additional clothing products to ensure the preferential access to the UK market currently available to developing countries is maintained.
However, Mike Cherry, national chairman of the Federation of Small Businesses (FSB), believed more should be done to protect SMEs from the ramifications of a no-deal Brexit.
“While these tariff adjustments will be good news for businesses in certain sectors – particularly smaller firms in our vital haulage industry – the cold hard fact remains that two thirds of small businesses that fear the impacts of no-deal feel they cannot prepare for this outcome,” he said.
“The average cost of preparation to small exporters and importers of putting contingencies in place is £3,000. Fundamentally, small firms are crying out for two things at this point: a pro-business Brexit deal and financial assistance to help manage the costs of uncertainty. The urgent issuing of £3,000 export vouchers is a must.
“It’s also important to stress that these tariffs only apply to the 12-month period after a no-deal scenario. What small businesses really want – with confidence suffering an unprecedented losing streak – is a return to an environment where they can plan three, five and ten years in advance.”
The uncertainty caused by the prolonged Brexit negotiations has also affected UK FinTech firms, with some people in the industry having begin to question whether Britain will remain a FinTech hotbed of innovation after the country’s conscious uncoupling from the EU.
The FSB is hardly the only organization to be worried about the regulatory uncertainty after Brexit. The Financial Conduct Authority’s chief executive recently stated that seven important areas to ensure trade remains steady after Brexit still remain unsolved.
Similarly, British bankers recently expressed their concerns that they would not have access to their biggest market unless Britain gets a shift on an implements new rules to ensure a smooth continuation of trade.
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