Market leading insight for tax experts
View online issue

HMRC publishes impact assessment for no-deal customs regulations

printer Mail

HMRC has published its Impact assessment for movement of goods in a no deal Brexit scenario, covering twelve statutory instruments published at the end of November to introduce new customs legislation and amendments to existing VAT and excise legislation for the trade in goods between the UK and the EU.

These regulations include provisions for:

  • customs import processes and procedures, including the submission of customs import declarations and applying to be an authorised economic operator;
  • lodging declarations before goods arrive at specified ports;
  • applying to use a range of special procedures;
  • paying, or deferring payment of, import duty;
  • transit of goods to, through and from the UK;
  • collecting trade statistics; and
  • a penalty regime.

The impacts of each instrument are summarised as follows:

  • Customs (Import Duty) (EU Exit) Regulations, SI 2018/1248, significant ongoing administrative costs associated with the obligation to submit import declarations and the payment of import duty, impacting UK and EU businesses of all sectors;
  • Customs (Special Procedures and Outward Processing) (EU Exit) Regulations, SI 2018/1249, significant one-off and ongoing costs of optional special customs procedures (mainly wholesale, retail and manufacturing sectors), with longer-term benefits in the form of deferred payment of import duty and import VAT, or suspension of payments altogether;
  • Customs Transit Procedures (EU Exit) Regulations, SI 2018/1258, significant one-off and ongoing costs of applying and using optional procedures, outweighed by long-term benefits of cash flow advantages and deferred submission of full declaration and payment of import duty and import VAT;
  • Value Added Tax (Disclosure of Information Relating to VAT Registration) (EU Exit) Regulations, SI 2018/1228, small cost of optional facilitation allowing UK and EU businesses to look up UK VAT registration numbers outweighed by benefits of accessing the information;
  • Draft Statistics of Trade (Amendment etc) (EU Exit) Regulations 2018, no additional cost to business, as amends existing EU legislation to retain existing obligations to submit Intrastat returns;
  • Customs (Contravention of a Relevant Rule) (Amendment) (EU Exit) Regulations, SI 2018/1260, negligible one-off cost for UK businesses trading only with the EU of familiarisation with penalty regime;
  • Draft UK-Crown Dependencies Customs Union (Isle of Man) (EU Exit) Order 2018, no impact on UK or IoM businesses, as introduces an obligation which maintains current rules;
  • Draft UK-Crown Dependencies Customs Union (Jersey) (EU Exit) Order 2018, no impact on UK or Jersey businesses, as introduces an obligation which maintains current rules;
  • Draft UK-Crown Dependencies Customs Union (Guernsey) (EU Exit) Order 2018, no impact on UK or Guernsey businesses, as introduces an obligation which maintains current rules;
  • Wharves and Temporary Storage Facilities (Approval Condition and Transitional Provision) (EU Exit) Regulations, SI 2018/1264, no impact currently, as final decision not yet taken on new discretionary power to impose an obligation on ports;
  • Wharves, Examination Stations and Temporary Storage Facilities (Approval Conditions) (EU Exit) Regulations, SI 2018/1265, introduces an obligation that has no additional impact on ports, airports or temporary storage locations; and
  • Customs (Temporary Storage Facilities Approval Conditions and Miscellaneous Amendments) (EU Exit) Regulations, SI 2018/1247, no additional impact, as formalises existing approval process for businesses seeking to operate temporary storage facilities and sets out mechanisms for presentation of goods between various modes of transport.

More secondary legislation will be issued over the coming months and further impact assessments will be issued as new regulations are laid. These regulations are likely to include provision for:

  • VAT rules for low value parcels coming into the UK;
  • the UK’s tariff;
  • registering for an EORI number;
  • submitting safety and security declarations;
  • framework for export of goods to the EU;
  • tax treatment of goods brought into the UK by travellers; and
  • customs, VAT and excise arrangements at Northern Ireland land border which will seek to avoid a ‘hard border’ for tax purposes.


Issue: 1424
Categories: News , Customs & Excise duties