In an effort to get a leg up on trade talks post-Brexit, the United Kingdom (UK) has announced a new UK Global Tariff (UKGT), set to go into effect January 1, 2021.
Taking four main approaches to the new tariff, the UK government published details on May 19, which are contained within the online tariff. However, only two of these approaches apply to most importers:
As Reuters characterizes it, the new tariff “aims to simplify what some UK officials call an overly complex EU system and help Britain negotiate trade deals with the United States, the Brussels-based bloc and others.” Under the proposed scheme, the tariff removes 30% of the current number of tariff subheadings by merging various existing subheadings—simplifying the tariff but also removing many full 10-digit codes, which most importers are accustomed to using.
Below are key takeaways to prepare for the end of the Brexit transition and the end of borderless access to the EU:
For about 40% of the headings, nothing will change and duty rates will remain exactly as they are currently. Moreover, nearly 75% of the total number of tariff subheadings will remain unchanged or have a minor rate correction, less than 0.9%.
To learn more about the impact of the new UK Global Tariff on your business, contact a Flexport customs expert.
Sign Up for the Freight Market Update newsletter for the latest market trends you need to know about - delivered right to your inbox.