Supermarkets and their shoppers face £3.1 bn a year in of tariffs on food and drink unless a free trade deal is reached between the UK and the European Union, retail leaders warned today.
The BRC said with the clock ticking down to Christmas the increase in tariffs without a deal would leave retailers with “nowhere to go” other than to raise the price of food.
It said many non-food retailers would also face large tariff bills for EU-sourced products, meaning the total cost to the industry and its customers would be even higher.
The new tariff schedule, published in May, which will apply from 1 January 2021 if a deal is not agreed, means 85% of foods imported from the EU would face tariffs of more than 5%. The average tariff on food imported from the EU would be over 20%, including 48% on beef mince, 16% on cucumbers, 10% on lettuce, and 57% on cheddar cheese.
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“There is no time to waste, the UK and EU must hammer out a final arrangement as soon as possible,” said Andrew Opie, director of food and sustainability at the BRC.
“Coronavirus is already making life hard for consumers, particularly those on lower incomes, and a no-deal Brexit will have a massive impact on their ability to afford essential goods.
“UK consumers have benefited from great value, quality, and choice of food thanks to our ability to trade tariff free with the EU. There is now the risk of a £3bn tax bill for the food we cannot source here in the UK. Unless we negotiate a zero-tariff deal with the EU, the public will face higher prices for their weekly shop. This would prevent harm to shoppers, retailers and the wider economy.”
The government said it was “working hard” to reach a deal.
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