The Treasury Select Committee met yesterday to take evidence from HMRC. The transcript isn't on the website yet but City AM report part of it (HERE). If anybody was still under the illusion that leaving without a deal was even a remote possibility they might want to take a look at what HMRC told the committee.
Apparently, a 'no deal' Brexit would see the UK without a 'fully functioning' customs system for two years.
Apparently, a 'no deal' Brexit would see the UK without a 'fully functioning' customs system for two years.
The City AM report says:
"Senior officials from HM Revenue & Customs told the Treasury committee the moment to start planning for the talks collapsing passed months ago" in a sobering warning. MPs heard the UK would struggle to collect tariffs properly, while the potential for traffic chaos at ports was a 'known unknown'
"HMRC official Jim Harra told the committee: 'I think we are looking at a minimum of two years from the no deal to get to a point where you can say we have a steady-state system where we are comfortable that we can manage all the fiscal risks in a way we would like and trade can flow in the way we would like.'
"HMRC Chief Executive, Jon Thompson, told the committee: 'The date for putting in an optimal customs system for the UK in the event of no deal was passed months ago.'"
Thompson is the man who told a meeting of the Exiting the EU Select Committee at the end of last year that in his opinion there was no need for a hard border 'under any circumstances', frequently quoted by the Brexiteers to support their case that the backstop is unnecessary (HERE). Yesterday he was asked what HMRC needed to do to prepare for the backstop being triggered:
"We would require further clarity on what is required in order for us to be able to work out what IT systems we would need to build".
"Secondly, as has been pointed out already part of that would be what IT systems would be have access to in the EU. We require clarity on both those points: what needs to be operationalised and what IT systems do we have access to."
He added: "In broad terms, if we were to make a number of assumptions we think it could be up to 30 months to do that work."
We desperately need the transition period (21 months at the very minimum - and probably more) and to get this we need the Withdrawal Agreement which in turn means we need to get the deal through parliament. And as I posted earlier this looks totally impossible.
"We would require further clarity on what is required in order for us to be able to work out what IT systems we would need to build".
"Secondly, as has been pointed out already part of that would be what IT systems would be have access to in the EU. We require clarity on both those points: what needs to be operationalised and what IT systems do we have access to."
He added: "In broad terms, if we were to make a number of assumptions we think it could be up to 30 months to do that work."
We desperately need the transition period (21 months at the very minimum - and probably more) and to get this we need the Withdrawal Agreement which in turn means we need to get the deal through parliament. And as I posted earlier this looks totally impossible.
No Brexit is beginning to look like the default position.
