Tariff simplification plans spell danger for British farmers

Farm leaders are demanding continued protection from cheap foreign imports, with tariffs maintained at current levels to avoid an influx of food produced to lower standards.

This followed a recent Department for International Trade consultation into its plans for a simplified tariff schedule to apply to imports once the Brexit transition ends at the end of the year.

In particular, the government is seeking to “catalyse free trade across the world” to generate greater wealth among nations.

See also: Relying on imports for our food is strategic folly

But responding to the consultation – which was only open for a month – the Ulster Farmers Union (UFU) said it is vital tariffs are set “at a level that prevents the UK from being flooded with imported food produced to much lower standards when compared to those our farmers are expected to meet”.

Recognising that many in government favour a cheap food policy, the UFU says food is already very affordable.

“The average UK family spends 10% of its income on food and drink – a decline from 30% in the 1950s,” said UFU president Ivor Ferguson. “In fact, in the UK, the proportion of household incomes spent on food is the third lowest in the world, behind only the US and Singapore.”

High standards

These concerns are shared by NFU Scotland president Andrew McCornick, who says it is “absolutely crucial that we keep tariffs at the current level”.

“Our industry is proud of the high standards it operates to, but these impose very significant additional costs,” he said. “With WTO rules not allowing trade to be blocked to ensure a level playing field, it is only through the applied tariffs that any protection can be offered to our industry.”

Mr McCornick added that any tariff reduction or removal should only be done as part of trade negotiations and in return for reciprocal concessions.

He suggested that the publication of a temporary tariff schedule by the UK government last year, as part of “no-deal Brexit” preparations, had caused potential trade partners to halt negotiations, because they knew they would get what they wanted without giving ground.

What the government is seeking

The Department of International Trade says it wants to simplify the UK’s tariff policy and remove tariffs on certain key inputs to production. It suggests:

  • Removing all “nuisance tariffs” (less than 2.5%)
  • Introducing tariff “banding”, so tariffs are rounded down. For example, a tariff of 12.8% would become 10%,  while a tariff of 48% would become 45%
  • Agricultural tariffs would be expressed as a single percentage, whereas currently some contain a fixed monetary element. For example, boneless cuts of beef have a tariff of 12.8% plus €303/100kg, while live chickens are levied at €52 per 1,000 birds.

However, the UFU sees a danger in a single percentage approach. “The agricultural process can be very volatile and a fall in prices would reduce the protection of local producers,” it says.

“This could subsequently lead to an import surge at a time of already low prices, further compounding the market problem.”

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