• ‘Disproportionately severe’ impact on retailers and shoppers must be avoided
  • Adoption of World Trade Organisation rules would mean high tariffs on food and clothing
  • Uncertainty facing EU workers in the UK must be ended, BRC says

Retailers could face higher costs and shoppers higher prices unless the Government wins a “good” Brexit deal by 2019, industry body the BRC has warned.

In a letter to Secretary of State for International Trade Liam Fox, the BRC said the Government must seek opportunities to bring down import costs and avoid any increase in tariffs.

The organisation has pledged to work with the Government to ensure the best outcome following Prime Minister Theresa May’s decision to trigger Article 50 and begin EU exit talks next March.

A good Brexit deal is essential to avoid “a disproportionately severe impact on retailers and their customers” if the UK had to default to World Trade Organisation (WTO) rules.

In that case, the BRC said, the tariff rates that the UK would apply to EU imports would be highest for consumer goods such as food and clothing.

The average duty on meat imports could be as high as 27%, while clothing and footwear tariffs may be as much as 16%, compared with the zero rating at present in force for EU imports.

Outside the EU

Reliance on WTO rules would also increase the cost of sourcing from outside the EU, the BRC said.

The import cost of women’s clothing from Bangladesh would be 12% higher, and Chilean wine would be 14% more expensive.

The Government should also seek out potential new trading partnerships with countries such as Australia that would reduce or eliminate existing tariff barriers to trade.

The BRC called too for “an early end to the uncertainty facing EU workers now residing in the UK and contributing to our economy”.

Between 100,000 and 200,000 EU nationals work for British retailers. “They deserve the reassurance that they will still be welcome here, whatever Brexit may bring,” the BRC maintained.

BRC chairman Richard Baker said: “We will be supporting the Government through this complex and difficult process, helping them analyse how increased cost pressures on retailers could mean higher shop prices and identifying any opportunities for new trade deals that could benefit consumers.

“The retail industry is the UK’s biggest importer and has huge experience of importing from every corner of the world. We will be engaged in a constructive dialogue with Government that will bring our experience to bear on the Brexit talks to the benefit of everyone in the UK.”

The BRC will formally launch a Fair Brexit for Consumers campaign on Thursday.

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