The UK Government has published a series of papers offering guidance to allow business to make preparations in the unlikely event of a “no deal” Brexit. So far, 25 papers have been released. Source: Timberbiz, TTF
Timber Trade Federation (TTF) UK has scanned the papers for content relevant to its members and would like to draw attention to the following three items, each of which the TTF has been lobbying hard on to get members views and concerns heard by policymakers.
TTF said that in particular, it was good to see the Government has listened to the timber industry and its campaign to ensure that our sector is not penalised by a VAT bombshell after Brexit. However, many further challenges still remain.
The three key areas identified are as follows:
VAT for businesses if there’s no Brexit deal
The government has conceded that upfront payments won’t be feasible and have pledged not to impose this in the case of no deal: “If the UK leaves the EU without an agreement, the government will introduce postponed accounting for import VAT on goods brought into the UK. This means that UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return, rather than paying import VAT on or soon after the time that the goods arrive at the UK border. This will apply both to imports from the EU and non-EU countries.”
Trading with the EU if there’s no Brexit deal
The government has said that in a no deal scenario one consequence would be “businesses having to apply the same customs and excise rules to goods moving between the UK and the EU as currently apply in cases where goods move between the UK and a country outside of the EU”. The document sets out what steps businesses will need to follow in this scenario. TTF members importing from outside the EU will be very familiar with these rules and the customs declaration procedures to apply them. Clearly the volume of declarations will increase substantially and so TTF will be working closely with customs to mitigate as far as possible the extra cost and work required.
Classifying your goods in the UK Trade Tariff if there’s a no Brexit deal
Once again TTF members importing from outside the EU will be very familiar with this process, and the duty rates which currently apply. This paper confirms that if no deal is reached than similar duty rates would need to be applied to products arriving from European countries. Fortunately, many wood products, for example sawn or PAR Softwood and Hardwood would remain duty free regardless of their source. The biggest potential impact of no deal in terms of duty rates would be for imported European woodbased panels which could incur rates of up to 10%.