Why has Theresa May decided to slash import tariffs for no-deal Brexit?

This government claims one of the great benefits of Brexit would be to negotiate free trade deals with countries outside the EU.

So some would say it is EXTRAORDINARY that it has announced on Wednesday if the UK leaves the EU without a deal it would voluntarily increase the proportion of imported goods that are subject to zero tariffs from 80% to 87%.

This is to give away its most important bargaining chip, its leverage, when negotiating free trade deals with non EU countries.

Its motive is a perfectly laudable one - namely to protect households from the inflationary impact of withdrawing from the EU's single market (as a matter of principle, the Treasury always put the spending power of consumers ahead of protecting businesses).

Tariff rules will change dramatically in the event of a no-deal Brexit. Credit: PA

But some would say it makes a nonsense of the prime minister's red line that any negotiated Brexit with the EU has to enhance the unilateral ability of the UK to negotiate free trade deals with any country it likes.

Why does she apparently value this unilateral ability to do free trade deals with other countries so little in the event of a no-deal Brexit?

To put it another way, my presumption is the Treasury's publication of the tariff schedule for a no-deal Brexit will have an important political impact on the Brexit debate.

The announcement is designed to have an impact in the Commons. Credit: PA

It will put wind in the sales of the Labour Party and rebel Tory MPs who believe the prime minister's decision to rule out membership of a customs union, because it would proscribe free trade deals with non-EU countries, is one of her more bonkers decisions.

And if some would see the hidden hand of the Chancellor Philip Hammond in adding momentum to the cross party campaign to keep the UK in the customs union, in whatever version of Brexit may (or may not) be ultimately agreed, that may not be fantasy or mad conspiracy.

PS Downing Street points out the no-deal import tariffs are supposed to be temporary and that after a year the government would consult on a possible different tariff schedule. The question is whether these tariffs would in practice be temporary in the way the backstop is!

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