UK faces huge administrative burden post-Brexit

Study finds 

The EU has made 15,055 amendments to its customs tariffs in the last 10 years. 

The number of EU tariff amendments has risen 36 per cent in the last five years, to 2,509 in 2016/2017 up from 1,847 in 2012/2013.

The sheer number of amendments made and the sharp uptick over the last five years highlights the scale of the administrative burden the UK will have to bear post-Brexit. 

BACKGROUND: What are tariffs and why is this important to the UK?

The EU’s Common Customs Tariffs set the duties to be paid on imports of goods from outside the EU. Rates of duty differ depending on the product and where it comes from, and are subject to change based on economic sensitivities, such as over- or under-supply.

The UK will have to take over control of regulating its own trade tariffs when it leaves the European Customs Union. These tariffs may have to be varied to ensure imports of goods are maintained at the right levels to suit the changing market for those goods.

The EU currently reviews all its tariffs twice a year and adjusts them as required. Implementing an equivalent system in the UK is likely to require significant investment in resources and training. 

DRIVER: Why has this increase in tariff amendments occurred?

The increase in amendments may be explained by the acceleration of global supply chains. As economies become more interconnected and import volumes grow, more amendments are necessary to keep the supply of goods in line with demand. 

Ensuring tariffs are adjusted so they allow the free flow of goods is important as UK manufacturers source components from across the world. Many companies now employ a ‘just-in-time’ production strategy, whereby they only receive goods as they are needed in the production process in order to improve efficiency. As a result, any disruption when importing goods can cause problems. 

EXAMPLES: Amended tariffs for strategically important goods to the UK

• Long-wave infrared cameras: used in drones and diagnostic systems to detect cancer;
• Perishables: including fresh foods and vegetable oils;
• Photovoltaic cells: used in solar panels to convert light into energy; 
• Rare earth metals: used in the manufacture of alloys for aerospace industry components;
• Reinforced glass: used in the manufacture and assembly of motor vehicles.