Taxes and tariffs to be cut under no-deal Brexit plan
‘Look at the figures. Our exports are at an all-time high … This is an economy that is in robust health’
BRITAIN will cut taxes and tariffs under secret plans drawn up by officials to kick-start the economy in the event of a no-deal Brexit.
Sir Mark Sedwill, the Cabinet Secretary, led a cross-departmental team examining the “economic levers” that can help make Britain more competitive.
The plans, which have been drawn up under the code name “Project After”, include a series of aggressive policies designed to help the UK “steal a march” on the European Union.
The most significant measures include cuts to corporation tax and VAT, along with further tax relief to encourage business investment.
According to the Financial Times, work on the plans began shortly after the Brexit referendum but were subsequently widened.
The list of policy options was completed at the end of last year. Officials also drew up plans to cut environmental regulations and labour laws, but these were shelved after the Prime Minister pledged not to weaken standards after Brexit. Another Whitehall plan, code-named Project Bluebell, is understood to be focused on limiting economic damage to the sectors most exposed to a no-deal Brexit, such as agriculture, car manufacturing and pharmaceuticals.
Philip Hammond, the Chancellor, has previously said that he is prepared to upgrade his spring statement next month into a full Budget and deploy £15billion to help boost the economy.
However, officials have raised concerns that cuts to corporation tax could result in a significant rise in borrowing. Liam Fox, the International Trade Secretary, told The Daily Telegraph: “Our economic fundamentals are very strong – just look at the figures. Our exports are at an all-time high. We have recently overtaken Germany as the biggest exporter to Hong Kong. This is an economy that is in robust health.”
Theresa May yesterday clashed with
Donald Tusk, the President of the European Council, who said there was “still no breakthrough in sight”. The Prime Minister rebuked him for saying the day before that there was a “special place in hell” for Brexiteers.
Remain ministers yesterday raised concerns about the prospect of a nodeal Brexit after the Prime Minister delayed a vote on her deal until late February or early March.
Stephen Hammond, a pro-european health minister, indicated he would be prepared to resign next week so he could vote to stop a no-deal Brexit.
He told House magazine that he was “clear where my responsibilities lie” as he suggested it would be a “last opportunity” to stop a no-deal Brexit.
The Telegraph understands that Tory and Labour backbenchers are planning to table a single amendment next week that would force the Government to request an extension of Article 50 if a deal cannot be reached.
He said: “I’m pretty clear where my responsibilities lie, much as I love this job, much as I think the NHS is a wonderful, wonderful institution.”
Mark Carney, the Governor of the Bank of England, yesterday blamed the “fog of Brexit” as he warned that Britain’s economy would grow at its slowest rate for a decade this year and could even fall into recession.
Asked if he ever wakes up in the morning regretting that he is Governor of the Bank of England, Mr Carney replied: “I don’t wake up in the morning any more. I wake up in the middle of the night.”