Business Readiness Forum Thursday 6 February 2020 Tim imeli lines - - PowerPoint PPT Presentation

OFFICIAL-SENSITIVE

Business Readiness Forum

Thursday 6 February 2020

Tim imeli lines and Process

• We're currently in a transition period which will last until the end of 2020.
• During the transition period, the current rules on trade, travel, and business will

continue to apply for the UK and EU.

• The government will not extend the transition period.
• Discussions with the EU on the structure and frequency of negotiations have begun.
• We expect negotiations will begin in March.

Future Relatio ionship wit ith th the EU

• The government wants to negotiate a relationship with the EU based on co-operation

and free trade.

• We are looking for an agreement like those the EU has previously struck with other

countries, such as Canada.

• The UK will leave the single market and the customs union at the end of this year.
• A future agreement cannot include any regulatory alignment and the European Court of

Justice cannot have any jurisdiction of over UK laws.

• The UK will develop independent policies on areas including immigration, competition

and subsidies, the environment, social policy, procurement and data protection.

Free Trade Agreement (F (FTA):

A free trade agreement between the UK and EU should cover the following areas:

• National Treatment and Market Access for Goods
• Trade Remedies
• Technical Barriers to Trade
• Sanitary and Phytosanitary Measures
• Customs and Trade Facilitation
• Cross-Border Trade in Services and Investment
• Temporary Entry for Business Purposes (Mode 4)
• Regulatory Framework
• Mutual Recognition of Professional Qualifications
• Financial Services
• Road Transport
• Competition Policy, Subsidies, Environment and Climate, Labour, Tax

Visit gov.uk/government/speeches/the-future-relationship-between-the-uk-and-the-eu for more information.

Support for businesses

• Government will work with businesses to ensure that they are well prepared for the end
• f the transition period.
• Visit gov.uk/transition for the latest updates.
• Visit gov.uk/get-rules-tariffs-trade-with-uk to look up tariffs, taxes and rules to trade

with the UK.

• Visit gov.uk/check-duties-customs-exporting to check duties and customs procedures for

exporting goods.

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QUESTIONS?

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UK Global Tariff Consultation

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UKGT: Overview

• DIT has launched consultation for 4-weeks starting 6 February – 5 March,

seeking stakeholder views on the UK Global Tariff (UKGT)

• The new UKGT will apply to goods imported into the UK on 1 January 2021

unless an exception such as a preferential arrangement, e.g. under a free trade agreement, or tariff suspension applies. In line with the NI protocol, special arrangements will apply to goods entering Northern Ireland.

• UKGT will replace what is currently applied during the transition period, the

EU’s Common External Tariff (CET)

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UKGT: Most Favoured Nation Principle

• An important principle for tariffs is the Most Favoured Nation

(MFN) principle, sometimes referred to as ‘WTO Terms’; as set out in the General Agreement on Tariffs and Trade (GATT). It means that the same tariffs on imported goods must be applied to all WTO trading partners, unless an exception such as a preferential arrangement, e.g. under a free trade agreement, or tariff suspension applies.

• The UK currently applies the EU Common External Tariff

(CET) as it’s applied MFN tariff, and will continue to do so until the end

• f the transition period.

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UKGT: Bound vs. Applied Tariffs

• Bound tariffs are the maximum tariffs the UK can apply in line with our legal

commitments at the World Trade Organisation (WTO). These tariffs are not applied at the border. Establishing a bound schedule is a WTO commitment, providing certainty and transparency to WTO members on what a country’s tariff schedule will be.

• Applied tariff rates are the tariffs applied at the border, the UK is free to set

whatever tariffs it wants, as long as they’re applied equally (in line with the Most Favoured Nation principle) and are below the bound rate

• The public consultation is on the UK applied tariff, not bound.

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UKGT: Policy Objectives

In setting the tariff rates, the Government will give due regard to the principles set out in the Taxation (Cross-border Trade) Act 2018:

• the interests of consumers in the UK,
• the interests of producers in the UK of the goods concerned,
• the desire to maintain and promote the external trade of the UK,
• the desire to maintain and promote productivity in the UK, and
• the extent to which the goods concerned are subject to competition.
• HMG will introduce the UKGT once it has considered all the evidence, including the

response to the consultation, in line with the Government’s stated strategic objectives, such as the delivery of the UK’s trade ambitions and FTA trade agenda, and to maintain the Government’s commitment to developing countries to reduce poverty through trade. The points for consideration set out in the consultation do not represent a final policy position.

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UKGT: Proposed Amendments

What are these proposed amendments?

• There are three key areas that HMG is considering amending from the current MFN tariff the UK

applies (i.e. the CET). These are: Simplifying and Tailoring the UK tariff schedule

• Examples of simplification:
• Removing Nuisance Tariffs (>2.5%)
• Tariff Banding
• Agricultural Tariff simplification

Removing tariffs on key inputs to production

• Removing tariffs on goods where a good is used as input by a process of production to create

another product. An example of this is fabric used in the production of apparel. Removing tariffs where the UK has zero or limited domestic production

• Removing tariffs on goods where a good has zero or limited domestic UK production

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UKGT: Elements of the Consultation

General Direction of MFN Policy Commodity Code Lookup Proposed Amendments General, high level questions on direction of MFN Policy. Using a tariff lookup tool to find specific commodities (this can be between the HS4 and HS10 level) and indicate whether they think the applied tariff should be removed, reduced, or stay the same. Specific questions relating to the proposed tariff schedule amendments:

• Simplification
• Removal of tariffs on key inputs to

production

• Removal of tariffs where there is

low to zero domestic production

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UKGT: Preview of Questions for Public Consultation

Example Question: Tariff Look Up Tool:

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UKGT: Useful Information

• Please fill in the Public Consultation: GOV.UK link to the Consultation

survey on DIT Website.

• If you have any process questions, please

email: tariffconsultation@trade.gov.uk

OFFICIAL-SENSITIVE

Business Readiness Forum

Thursday 6 February 2020