Card payments likely to rise in event of ‘no deal’ Brexit
CONSUMERS and holidaymakers face a multi-million pound hit if there is a no-deal Brexit because of a “likely increase” in the cost of card payments between the UK and the EU, technical papers released by the Government reveal.
Cross-border payments would no longer be covered by a “surcharging ban” that prevents businesses adding an extra levy when people use a specific payment method.
The Government’s own figures from earlier this year say that the surcharges, which were banned in January, cost Britons £166 million in 2015.
The warning is contained in one of 24 technical papers covering preparations businesses should take in case the UK and EU cannot agree a deal before Britain leaves the trade bloc in March.
The first raft of papers includes banking, medicines and clinical trials, nuclear research, workplace rights and farm payments.
Consumers would face another potential cost increase when online shopping, with parcels arriving in the UK no longer liable for Low Value Consignment Relief (LVCR) on VAT.
One paper covering trade with the EU also highlights potential new costs for firms trading with Europe.
It says companies should “if necessary, put steps in place to renegotiate commercial terms to reflect any changes in customs and excise procedures, and any new tariffs that may apply to UK-EU terms”.
It adds: “Businesses should consider whether it is appropriate for them to acquire software and/or engage a customs broker, freight forwarder or logistics provider to support them with these new requirements.”
The Northern Ireland border, one of the most contentious issues in Brexit negotiations, is also mentioned.
UK firms that trade with Ireland should “consider whether you will need advice from the Irish Government about preparations you need to make”.
Importing nuclear materials from the EU may require a licence under a no-deal outcome, according to a paper outlining the impact on civil nuclear regulation.
Licences are not required under current arrangements, but the document warns that after March 29, 2019 “importers may need to obtain an import licence for imports of relevant nuclear materials from the EU”.
New medicines will need UK approval before they can be made available to patients in the event of a no-deal Brexit.
The Medicines Healthcare Products Regulatory Agency (MHRA), which regulates drugs in the UK, will take on the functions of the EU if there is no agreement by March 29.