UK retailers warn shoppers face price hikes if no EU trade deal agreed
Britain’s retail industry has warned that consumers could face higher prices next year if the UK is unable to reach a tariff-free EU trade deal.
The British Retail Consortium said the industry could not absorb the additional costs of tariffs, meaning the hike in prices would be passed on to consumers whose finances have already been hit by the coronavirus crisis.
Four-fifths of UK food imports come from the EU and EU imports play a crucial role in the supply chain for the fashion and homeware sectors.
Under the UK government’s tariff schedule, which would apply from the beginning of next year if an EU trade deal is not agreed, 85 per cent of food imported from the bloc will face tariffs of more than five per cent.
This includes 48 per cent on beef mince, 16 per cent on cucumbers, and 57 per cent on cheddar cheese, the BRC said.
The average tariff of food imported from the EU would be more than 20 per cent.
BRC director of food and sustainability Andrew Opie said the disruption could be worse than the shortages experienced in the run up to the coronavirus lockdown.
“The next few months are critical to the living standards of millions of people in the UK,” Opie said.
He added: “Without a tariff-free deal with the EU, the public will see higher prices in supermarkets from next year, squeezing millions of families already impacted by the current economic downturn. This is not the fair deal that consumers were promised.
“Many UK shoppers experienced disruption in the run up to lockdown; without a deal, the public may face an even bigger challenge at the end of the transition period.
“With the clock ticking down to 31 December, the Government must put consumers first and agree a deal that avoids tariffs and minimises the impact of non-tariff barriers. This would prevent harm to shoppers, retailers and the wider economy.”