UK firms have reacted angrily to plans for the sweeping changes to tariffs in the event of a no-deal Brexit, with business leaders slamming the government’s approach as “cack-handed”.
Wide-ranging organisations accused policymakers of rushing out plans for major changes in trade terms without consulting firms first, leaving them with no time to prepare.
Under the plans, tariffs will be cut to zero on 87% of goods imported to the UK as a temporary response if the UK crashes out of the EU without a deal. The changes were announced as the government attempts to mitigate a £9bn food-price shock from a no-deal Brexit. However, the prices of some imported goods will rise, including meat, shoes and some cars.
Allie Renison, head of Europe and trade at the Institute of Directors, said that while cutting tariffs unilaterally was a necessary and welcome part of a country’s trade policy, the government had failed to do it in an open and consultative way.
“The belated, cack-handed way in which the government has handled its no-deal planning is one of the main reasons why many businesses will not be prepared for this outcome by 29 March,” Renison said.
“Politicians should be under no illusion: this package of mitigating measures do not help make the case for no deal. They are rather a reminder of the spike in invidious choices we would face as a country amidst a backdrop of chaos.”
Carolyn Fairbairn, director general of the CBI lobby group, described the announcement as a “sledgehammer for our economy”.
“This tells us everything that is wrong with a no-deal scenario. What we are hearing is the biggest change in terms of trade this country has faced since the mid-19th century being imposed on this country with no consultation with business, no time to prepare,” she said.
“This is no way to run a country. What we potentially are going to see is this imposition of new terms of trade at the same time as business is blocked out of its closest trading partner.”
Unite, Britain’s biggest union, and the Society of Motor Manufacturers and Traders (SMMT), the main body representing the car industry, called on the government to take no-deal off the table immediately.
Steve Turner, Unite’s assistant general secretary for manufacturing, said: “Reducing tariffs to zero on the majority of imports, including steel, in the event of a no-deal Brexit would destroy jobs and leave UK manufacturers competing with both hands tied behind their backs.”
Business groups and major companies have been outspoken in their campaign against leaving the EU without a deal, which they argue will harm exports and cause chaos at UK ports, disrupting vital imports.
Mike Hawes, the SMMT’s chief executive, said: “No policy on tariffs can come close to compensating for the disruption, cost and job losses that would result from no deal. It’s staggering that we are in this position with only days until we are due to leave.”
Meanwhile, David Potts, the chief executive of the supermarket chain Morrisons, said that as two thirds of its food came from the UK – including all beef and poultry – it would not be affected by many of the tariffs.
“It falls to retailers to continue in a very competitive framework by which British consumers get great value,” he said.