Less than 10% of businesses are ready for no-deal, says Newsnight
According to figures reported on Newsnight, many UK businesses are “not even close to being ready for a no-deal” Brexit.
This claim is based on the number of firms that have applied to the Transitional Simplified Procedures scheme.
This scheme was launched by HMRC in February and aimed to make imports easier in the event of the UK leaving the EU without a deal and thus abruptly leaving the customs union and single market.
Newsnight found that less than ten per cent of firms that require the status had applied for it as of 26 May.
The Transitional Simplified Procedures scheme is designed to allow UK firms to continue to import goods from the EU without filling out fresh customs declarations at the border.
It would also allow UK businesses to delay the payment of import duties for one year.
Despite HMRC saying that that the plan was to ensure “as many traders as possible are ready”, figures show that only 17,800 firms had applied for the TSP. This constitutes less than a tenth of the 240,000 firms who are estimated to require this status.
Before acquiring TSP status, firms that have only ever traded within the EU will need to acquire an Economic Operator and Registration Identification number. This is a basic legal requirement for companies to import and export goods.
According to the BBC, only 69,000 firms had signed up for this number by 26 May, less than a third of the total companies estimated to need one.
HMRC have written to 145,000 VAT-registered businesses three times urging them to sign up for one: in September 2018, December 2018 and January 2019.
HMRC claim that the process of registering for an EORI number only takes 10 minutes and that it has the capacity to register 11,000 businesses every day.
A spokesperson for HMRC said: “HMRC has well-developed plans in place to ensure the UK will have functioning tax and customs processes for UK-EU trade in the event of no deal."
“Many businesses have already registered with HMRC as international traders –accounting for around two thirds of the trade carried out by UK VAT registered businesses that only trade with the EU.”
Mike Spicer, of the British Chamber of Commerce, struck a less optimistic tone. Commenting on the number of businesses that have signed up to the scheme, he said: “If it really is this low we’re far, far away from being day one no-deal Brexit ready – it’s a very low number.”
This was echoed by Matt Griffith of the Bristol Chamber of Commerce who said: “The TSP data is terrible.”