The car industry would be among the sectors most affected negatively by a ‘no deal’ Brexit, according to a letter published today by Chancellor of the Exchequer Philip Hammond.
It follows yesterday’s publication by the UK’s Brexit Secretary Dominic Raab of “practical and proportionate advice” in case the UK leaves the European Union next March without having agreed a deal.
That would mean the free circulation of goods and services to and from the EU would cease, said the government.
The government said the UK would require payment of customs duty at the rate set by it under The Taxation (Cross-Border Trade) Bill for goods imported from the EU.
Hammond’s letter stated: “In July the government published its White Paper setting out a clear proposal for the future relationship we want to build with the European Union. Since publication talks have intensified and the government is confident of reaching agreement on the Withdrawal Agreement and Future Framework in the autumn.
“While we are confident in agreeing a good deal for both sides, as a responsible government we will continue to prepare for all scenarios.”
At the National Franchised Dealers Association, director Sue Robinson said: “It is encouraging to see that the Brexit Secretary has stated that reaching a deal remains an ‘overriding priority’ and a ‘no-deal’ scenario is not what the government wants or expects.
"Positively, the government has started to prepare for every possible scenario and is now providing advice to businesses suggesting them to ‘review their contingency plans’, which we invite our members to do.
“We are pleased to see that the government is keen to pick up the pace of negotiations with the EU as this will give businesses and consumers more clarity and confidence to plan ahead.
“NFDA will continue to engage with the government to ensure that the negotiations will have the best possible outcome for UK car retailers. In particular, we await the publication of the ‘Trade Agreement Continuity’ notice which is likely to include important details about future trade between the UK and EU.”