Business

Fall in trade will hit SMEs forced to shun EU exporting, Azets warns

The total exports of goods, excluding precious metals, in the three months to August 2021 decreased by £1.2b (1.5%)

A fall in trade between the UK and EU shows UK SMEs are shunning EU exports, a tax expert at Azets warns.

Latest data from the Office for National Statistics (ONS) shows a second consecutive monthly fall in trade, with the effects of Brexit and the global pandemic resulting in the total exports of goods, excluding precious metals, falling by £1.3b (4.6%) in August 2021. This was partly due to a £0.6b (4.3%) fall in exports to the EU.

The total exports of goods, excluding precious metals, in the three months to August 2021 decreased by £1.2b (1.5%).

The fall in trade between the UK and EU is the result of a failure to support EU exporters, said Lucy Sutcliffe, National Customs director and head of customs at Azets.

Sutcliffe is urging UK businesses to prepare for new border processes when the extensions and deferral period ends.

She said: “Small UK businesses have been completely overwhelmed by bureaucracy and the additional time and cost it takes to trade across Europe. New duties, border delays and transport costs are pushing UK SMEs into rethinking trade with the EU.

“The UK’s focus has been on facilitating and streamlining the importation process and easing the associated documentary demands. It has not focused on assisting exporters.”

She added: “UK businesses importing products from the EU should be ready to comply with the UK’s new border processes. Businesses should make sure they maintain good communication with suppliers and ensure that all relevant paperwork is provided in a timely manner to avoid delays at the frontiers.

VAT registered businesses should consider using postponed VAT accounting to avoid having to pay Import VAT at the frontier and become aware of all the special duty reliefs that can defer or exempt them from customs duty. These measures will help cash flow and ease the bureaucratic burden.”

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