By Port Technology International Team
As part of a new approach following the UK’s exit from the EU the Government is developing a new ‘UK Most Favoured Nation (MFN) tariff’ which will enter into force on 1 January 2021.
This bespoke regime, known as the UK Global Tariff, will ensure UK businesses compete on fair terms with the rest of the world whilst benefitting households through greater choice and lower prices, according to a statement released by the Department for International Trade on 6 February.
Ultimately, according to the statement, this will also help to make it easier to trade, drive up investment, and deliver more quality jobs across the UK.
“The UK has left the EU and it is time for us to look forward to our future as an independent, global champion of free trade,” International Trade Secretary Liz Truss said in a statement.
“It is vitally important that we now move away from complex tariff schedule imposed on us by the EU.”
The consultation will be open online for four weeks from today, closing on 5 March, and all views will be taken into account before the Global Tariff Policy in finalised.
Goods coming into the UK will no longer be subject to the EU’s Common External Tariff as they have been for nearly 50 years, with the UK’s new Global Tariff Policy coming into effect on 1 January 2021 for imports from any country the UK does not have a free trade agreement with.
This comes as the Government sets out details of the UK’s approach to negotiating free trade agreements with countries including the US, Australia, New Zealand and Japan.
The new UK Global Tariff Policy will apply to goods from countries around the world unless the UK has different arrangements in place, for example under a free trade agreement, or a tariff suspension applies. Tariffs levied by other countries on UK exports will depend on that country’s own MFN tariff schedule and whether the UK has a trade agreement in place with them.
The UK will allow imports from countries that UK has a free trade agreement or other arrangement with, and with the world’s poorest countries continuing to access the UK at lower tariffs as set out in those agreements.
In line with the Northern Ireland protocol, special arrangements will apply to goods entering Northern Ireland.
As part of the consultation, the government is seeking views on:
Simplifying and tailoring the tariff to suit UK businesses and households, such as removing tariffs of less than 2.5% and rounding tariffs down to the nearest 2.5%, 5% or 10% band;
Removing tariffs on key inputs to production which could reduce costs for UK manufacturers; and
Removing tariffs where the UK has zero or limited domestic production which could help to lower prices for consumers.
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