Since Brexit, British businesses have experienced a significant increase in the complexity and cost of trading with the EU, with an average of nearly £100,000 spent on post-Brexit border crossings over the past three years. This has been revealed by new data.
A survey of 1,001 senior decision makers at UK-based companies trading overseas found that 81% believe they now face a more complex situation than before Brexit. found.
Three-quarters reported that sales to the EU were reduced or made more complex as a result of bureaucratic barriers such as tariffs and regulatory compliance obligations put in place by the EU-UK Trade and Cooperation Agreement.
A similar proportion of people say their business has become less profitable as a result of Brexit, with 70% of those who voted to leave the EU and 79% of those who wanted to remain in the EU share this view. Ta. The average cumulative cost since 2020 for businesses that reported that Brexit had “damaged” their operations was he £96,281.
The findings were announced on Wednesday as the UK government phased in new Brexit border checks on imports of most animal and plant products from the EU.
The British Chambers of Commerce warned on Monday that many businesses remain “in the dark” about key aspects of the new border. The new border will require the use of Export Health Certificates (EHC) from the end of April and will include physical inspections at ports.
William Bain, director of trade policy at the BCC, said there was a risk that the border would further increase cost pressures on businesses, adding: “These additional costs will ultimately be passed on to UK importers and their customers, reducing trade prices. “There is a big concern that there will be upward pressure on the market,” he said. It’s inflation,” he said.
Meanwhile, more than three-quarters of survey respondents agreed that the UK has not experienced the trade boom promised by Brexiteers, including 73% of Leave voters, This includes 84% of Remain supporters.
British officials acknowledge that Brexit poses challenges for business, but add that they are working with industry and the EU to reduce friction wherever possible.
Alex Bawolf, vice president of global indirect tax at tax technology firm Avalara, which commissioned the Census Wide study, said he was “a little surprised” by the high average total costs incurred by businesses.
But he added that the overall picture of businesses being hurt by new cross-border compliance and trade red tape is not surprising.
“Currently, we have a customs border and companies are looking for ways to get around it, but that means a compliance burden with increased paperwork,” Bawolf said.
“British companies are trading less with the EU and that is having an impact.” [their] Revenue. Where there is trade, additional costs are being incurred and profits are being squeezed. ”
The findings are in line with recent research by the British Chambers of Commerce and manufacturing organization Make UK, which found that three years after Brexit, businesses have seen little improvement in their trade with the EU. It was shown that there is no.
Make UK has revealed that nine out of 10 UK export manufacturers still face challenges doing business with the EU, almost three years after the post-Brexit trade deal came into force. This proportion has changed little since the first post-Brexit survey was conducted midway through. ~2021.
Avalara research found that 82% of UK businesses intend to support the UK Government's efforts to improve trade across Europe.
The research looked at a wide range of companies with a turnover of up to £500m. About half of the employees had less than 250 people, and the rest had more than 250 people.
The majority (68%) say they have considered trading in non-EU markets, with 45% actively expanding into the US, 41% in Canada, 27% in New Zealand and 26% in China.
