Global Free Trade boost for UK amid Coronavirus Pandemic

This week the Government announced the UK’s new tariff regime, the UK Global Tariff (UKGT). This is a flagship moment and will replace the Common External Tariff on 1 January 2021 at the end of the Transition Period. The arrangement comes as the UK Trade Bill made its way through Parliament at the second reading as we head towards an independent trading policy.

This new tariff is tailored to the needs of the UK economy, satisfying many across the country who voted to leave the EU in June 2016. It will support the economy by making it easier and cheaper for businesses to import goods from overseas. It is a simpler, easier to use and lower tariff regime than the EU’s Common External Tariff and will be in pounds, not euros. It will scrap the notorious red tape and other unnecessary barriers to trade, reduce cost pressures and increase choice for consumers and back businesses large and small to compete on the global stage.

By reclaiming our sovereignty, we can importantly take control of our laws and tailor legislation to our own needs. For example, the legislation will enable us to streamline and simplifying nearly 6,000 tariff lines, removing bureaucracy and lowering costs for businesses by reducing administrative burdens.

Andy Carter MP welcomed the boost for business:

The shift to a new global trading arrangement is a watershed moment for this country as we look to forge our new position in the World. Being able to take control of our own legislative agenda and tailor trade to the needs of consumers and businesses is exactly why many voted to Leave back in 2016.

Crucially, the agreement ensures that 60% of trade will come into the UK tariff free on WTO terms from the start of 2021. Added to this, successful free trade deals will increase this and allow for our own domestic market to prosper.

Speaking to farmers in Warrington South they will be pleased to know that this will lower their business costs, ensuring they can compete on fair terms with the rest of the world, as well as keeping prices down and increasing choice for consumers.

The new guidance which will take affect from 1st January 2021 is supporting many industries by:

  • Maintaining tariffs on agricultural products such as lamb, beef, and poultry.
  • Maintaining a 10% tariff on cars.
  • Maintaining tariffs for the vast majority of ceramic products.
  • Removing tariffs on £30 billion worth of imports entering UK supply chains. 0% tariffs on products used in UK production, including copper alloy tubes (down from 5.2%) and screws and bolts (down from 3.7%).

International Trade Secretary Liz Truss said:

For the first time in 50 years we are able to set our own tariff regime that is tailored to the UK economy.

Our new Global Tariff will benefit UK consumers and households by cutting red tape and reducing the cost of thousands of everyday products.

With this straightforward approach, we are backing UK industry and helping businesses overcome the unprecedented economic challenges posed by Coronavirus.