LONDON — British businesses have been left on hold after the government ignored their proposed import tariff changes and instead moved ahead with its own plan of blanket cuts to deal with the soaring cost of living.
Businesses have been waiting 12 months for a response to detailed submissions they have prepared on reducing duty on goods entering the UK border.
The government asked for the post-Brexit presentations in June 2020 and businesses and trade groups responded with ideas for cuts on dozens of tariff lines. But the proposals were met with silence.
Nearly 240 tariff cuts have been requested across many sectors, including food and beverages, chemicals, manufacturing, dyes and electronics. For example, the Princes food brand has requested the lifting of tariffs on a host of imported juices, while the Autocraft Solutions group has requested easements on used diesel engines.
After failing to push through the proposals, ministers instead proposed sweeping tariff cuts in what was seen as a hasty response to the UK’s cost of living crisis. The Commerce Department has been ordered to investigate the No 10 Downing Street idea – although critics say sweeping cuts could reduce British influence in trade deal talks.
The government measures have left companies scratching their heads.
Dominic Goudie, head of international trade at the Food and Drink Federation (FDF), said a unilateral tariff cut at this time “would do little to address the cost of living issues, but it would seriously hurt ambitious UK trade negotiations and could have adverse effects”. for UK food safety.
He added that if the government wanted to reduce tariffs, “a good starting point would be to take a decision on the tariff suspensions which have been pending since last summer”.
“With those confirmed, the government could work with industry to identify additional time-limited emergency tariff suspensions to ease price pressures, but without undermining talks with key trading partners.”
A senior executive from a business group that has filed tariff suspension requests said: “We are still awaiting responses and wondering why action has been delayed given that such a decision could be seen as a advantage of Brexit, boosting UK competitiveness.”
The British Soft Drinks Association helped prepare a request to suspend two product codes on orange juice products and have since written to ministers to inquire about the lack of response. The codes represent a 12% tariff on orange juice imports, according to the BSDA.
“A tariff suspension lowering the cost of importing oranges would benefit UK consumers and the UK economy by ensuring a continued supply of quality produce, potential reduction in retail prices and growth of the category, which at in turn, would increase production and employment opportunities. said BSDA director Gavin Partington.
Despite enthusiasm elsewhere in the Cabinet, trade ministers are against wholesale tariff cuts, as are some experts, who also fear the move could damage Britain’s influence in trade talks. But others in government are pushing the idea. If so, the easements should be time-limited.
A DIT spokesman said the government is “carefully assessing the high volume of applications received and will publish the result once this process is complete”. The spokesperson added: “Any resulting suspension will take effect shortly thereafter.”