Tuesday 10 October 2017

NEW CUSTOMS REGIME

Yesterday, to coincide with the PM's statement to the House, the government released a White Paper on the New Customs Regime (HERE). I don't pretend to follow all the details but there are a few points to note. Paragraphs 5.12 and 5.13 are in fact repeated as if it was all produced in a hurry and nobody actually proof read it before publication. However, this is not the only bit of slipshod preparation about it.


As someone has already pointed out it doesn't even cover what is referred to as "additional border activities" (see paragraph 3.8) including conformity checks and animal and plant safety checks which are expected to be the main source of delays. These are not involved in collecting duty so don't feature at all.

The paper also "does not presuppose any particular outcome from the negotiations with the EU" which makes it slightly useless in any case although it does make reference to leaving the EU without a deal.

It talks about a "new customs partnership" that "could support UK-EU trade outside of a customs union arrangement, while still removing the need for customs processes at the border" although why the EU would be interested in developing a wholly new arrangement just for us is not explained. Neither does it set out how much time, effort and cost would be involved in it. And still the government has a touching belief in a new "highly streamlined" system but admits this would be an "innovative and untested approach" but still seems to think it can be knocked up in a few months.

For ordinary people this is buried at paragraph 5.43:

"Due to the EU’s geographical proximity to the UK, allowing parcels valued £15 or less to be sent from the EU without VAT being payable would potentially undermine the UK high street in the same way as low value parcels sent from the Channel Islands did before the rules were changed in 2012. Applying the current rules for parcels sent from non-EU countries to all parcels would also increase the volume of parcels on which Royal Mail and fast parcel operators have to collect tax, and more UK consumers would have to pay tax when their goods are delivered"

This will no doubt be greeted with delight by those small traders doing business with suppliers and customers in the EU.

On the no-deal scenario, which the white paper coyly refers to as the contingency scenario, it says it is "seeking the views of businesses and other stakeholders on these solutions" which will no doubt be a comfort to UK business with 18 months to go. However, the paper will serve its purpose at home. The anti-EU press will never even read it and assume it contains reams of solid, practical detail and will tell its reader so. In fact it is pure wind.

At the same time (HERE) Liam Fox set out a policy paper "Preparing for our future UK trade policy" which, hard though it is to believe, is even more vacuous than the new customs white paper.