To ask the Chancellor of the Exchequer, what recent estimate he has made of the potential annual cost of tariffs which will be paid by UK businesses to the EU in the event that a free trade agreement is not signed.
2 November 2020
The UK wants a relationship with the EU which is based on friendly cooperation between sovereign equals, and centred on free trade. The Government believes that it is still possible to reach an agreement with a Free Trade Agreement at the core, like those the EU has agreed with other close partners around the world, and that this could be done quickly.
A negotiated outcome remains the Government’s clear preference. It has put forward proposals and is working hard to reach a deal with the EU. The Government’s aim is a zero tariff zero quota FTA, given that avoiding tariffs is beneficial to both sides.
From 1 January, the UK will keep all our tariff revenue, rather than remit 80% to the EU as we have done as a member of the customs union.
As is standard practice, the Office for Budget Responsibility will publish an updated estimate of tariff revenue at the next forecast based on their latest set of assumptions and tariff schedule.