Thank you to those who have contacted me recently about VAT and red tape following the end of the transition period with the European Union on 1 January.
I appreciate the concerns you raise. As you note, we have seen EU businesses stop selling their products to the UK via mail because of new VAT rules. And as you also note, this is just one aspect of the new administrative burden facing businesses and consumers in the UK following the Government’s deal with the EU. We have already seen the emergence of numerous issues in our new trading relationship with the EU as a result of the Government’s poor preparations and loopholes in the deal it negotiated.
While the Government’s deal with the EU was better than the disaster of no deal, it falls far short of what was promised. Farmers, manufacturers, hauliers and our fishing industries all now face extra delays, costs and bureaucracy when taking their goods to European markets. The treaty imposes far more red tape on British businesses than there was before, including hundreds of millions of new customs declarations. This is harming British industries and holding back our economic recovery from the coronavirus pandemic.
On the specific issue of VAT, I believe the Government must make clear what the economic impact of the changes made since 1 January will be, including how many UK and EU businesses will no longer be able to send goods across the border between the two jurisdictions. It must also make clear what it is doing to protect UK consumers from unclear or hidden customs and VAT charges when buying goods from EU retailers.
More widely, I believe the Government needs to take action on the red tape and bureaucracy that has resulted from its EU trade deal. Businesses and working people should not pay the price for ministerial incompetence. Too often the Government failed to heed warnings from industry. It must now listen to businesses, consumers and others and act to avoid lost contracts, unemployment and harm to UK industries.
Thank you once again for contacting me about this issue. I can assure you that I will support efforts to highlight more evidence of the consequences of the Government’s deal as it emerges, with a focus on closing loopholes, pushing for practical solutions and building on the deal in the national interest.