Analysing The Political Economy

Third Of British Exporters To EU Vanish Over Brexit Red Tape

Jacob Rees-Mogg’s desk should be completely covered in ideas for Brexit opportunities and just one of them is the red tape caused by it and the damage to British exports as a result.

According to new data from HMRC – the number of UK businesses exporting goods to the EU fell a whopping 33 per cent to 18,357 in 2021, from 27,321 in 2020.

Discussing the figures with City A.M. – Michelle Dale, a senior manager at accountancy firm UHY Hacker Young, pointed out the fall is due to the extra red tape UK businesses must now comply with when exporting to the EU.

Businesses are not getting enough support from the Government to navigate the post-Brexit trading minefield. A lot of SMEs can’t afford professional advice to cope with Brexit-related red tape. Many are likely to have decided trading with the EU is not worth the cost. Fewer UK companies exporting to the EU will result in lost opportunities for growth and expansion in Europe.

In a response to the findings, a spokesperson for HMRC said: “We have continually advised caution when comparing statistical trade data post-January 2021.”

The reason for the caution is that HMRC now collects data in a different way since the UK left the EU. The department said – “comparing year-on-year data can lead to misinterpretation and factual inaccuracies, which we believe is the case here.”

In further confirmation that Brexit is not going well and that red tape and additional taxes apply – Britain’s art trade has plummeted in the last twelve months to such an extent that China, Italy, France and Germany have all overtaken the UK’s highly prized second art trade slot behind that of the USA.

It also emerged last week that Brexit has spurred a rise in City firms sponsoring overseas recruits, with around 200 workers based outside of the UK being hired per week.

It comes amid a labour shortage on British soil, which has seen City law firms battle it out for the highest pay.

Visa sponsorships by UK-based financial services firms have been rising steadily for around a year, climbing from 722 in the fourth quarter of 2020 to 2,192 in the final few months of last year, The Times first reported, citing Home Office figures. Brexit red tape is now becoming the overarching concern of a high percentage of British businesses dealing with Europe.



European financial review Logo

The European Financial Review is the leading financial intelligence magazine read widely by financial experts and the wider business community.