Sourcing suppliers

Food industry faces 9.3bn tariff bill under a no-deal Brexit

Food retailers and their suppliers could face a 9.3bn blow under a “no-deal” Brexit, a study has claimed.

A new Barclays Corporate Banking report has revealed that a failure to reach any Brexit deal will create an average tariff of 27% on products imported from the EU for food and drink supply chains.

There would be varying tariffs for different types of products. For example, the Barclays report showed that fully processed food and drink products, such as orange juice, will attract the highest tariff rate of 31% compared to 29.5% for semi-processed food and drink such as white sugar, and 9.7% for primary products and raw materials like bananas.

The report Scale, Disruption and Brexit a new dawn for UK food supply chains? said the new tariff would be significantly more than the 3-4% levy that would hit non-food products. Additionally, every consignment of goods from the EU will require a customs declaration which starts at a minimum of 50.

Last year, the UK imported 48bn worth of food and drink, approximately 40% of the total UK market. Of these, 71% originating from within the EU entered the UK free of customs duties and other trade costs.

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HMRC publishes VAT guidance in the event of no-deal Brexit

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