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UK Tariff Changes announced from 1st January 2021

From 1 January 2021, the UK will apply a UK-specific tariff to imported goods.

This UK Global Tariff (UKGT) will replace the EU’s Common External Tariff, which applies until 31 December 2020.

The new tariff is tailored to the needs of the UK economy. It will support the economy by making it easier and cheaper for businesses to import goods from overseas. It is a simpler, easier to use and lower tariff regime than the EU’s Common External Tariff (EU CET) and will be in pounds (£), not euros.

The UKGT also expands tariff free trade by eliminating tariffs on a wide range of products. The UKGT ensures that 60% of trade will come into the UK tariff free on WTO terms or through existing preferential access from January 2021, and successful FTA negotiations will increase this.

This will lower costs for businesses, ensuring they can compete on fair terms with the rest of the world, as well as keeping prices down and increasing choice for consumers.

The Government is maintaining tariffs on a number of products backing UK industries such as agriculture, automotive and fishing. This will help to support businesses in every region and nation of the UK to thrive. Some tariffs are also being maintained to support imports from the world’s poorest countries that benefit from preferential access to the UK market.

The UKGT was designed following widespread engagement with businesses across the UK. As it will come into force on 1 January 2021, it’s important that businesses can familiarise themselves with the new tariff regime ahead of this date.

The Government are backing UK industry by:

Maintaining tariffs on agricultural products such as lamb, beef, and poultry.
Maintaining a 10% tariff on cars.
Maintaining tariffs for the vast majority of ceramic products.
Removing tariffs on £30 billion worth of imports entering UK supply chains. 0% tariffs on products used in UK production, including copper alloy tubes (down from 5.2%) and screws and bolts (down from 3.7%).

UK consumers will also benefit from more choice and lower costs on numerous goods thanks to zero tariffs. These include, for example:

Dishwashers (down from 2.7%).
Freezers (down from 2.5%).
Sanitary products and tampons (down from 6.3%).
Paints (down from 6.5%) and screwdrivers (down from 2.7%).
Mirrors (down from 4%).
Scissors and garden shears (down from 4.7%).
Padlocks (down from 2.7%).
Cooking products such as baking powder (down from 6.1%), yeast (down from 12%), bay leaves (down from 7%), ground thyme (down from 8.5%) and cocoa powder (down from 8%).
Christmas trees (down from 2.5%).

The Government will promote a sustainable economy by cutting tariffs on over 100 products to back renewable energy, energy efficiency, carbon capture, and the circular economy. The following are all dropping to zero tariffs:

Thermostats (down from 2.1%).
Vacuum flasks (down from 6.7%).
LED lamps (down from 3.7%).
Bike inner tubes (down from 4%).

Almost all pharmaceuticals and most medical devices (including ventilators) are tariff free in the UKGT. However, some products used to fight COVID-19 maintain a tariff. To ensure those working on the frontline can access vital equipment easily, the UK has introduced a temporary zero tariff rate on these products. This relief waives the tariff and VAT for personal protective equipment (PPE), medical devices, disinfectant and medical supplies from non-EU countries.

The UKGT will apply to all goods imported into the UK unless:

An exception applies, such as a relief or tariff suspension
The goods come from countries that are part of the Generalised Scheme of Preferences
The country you’re importing from has a trade agreement with the UK

It only shows the tariffs that will be applied to goods at the border when they’re imported into the UK.

It does not cover:

Other import duties, such as VAT
The precise details of trade remedies measures
Other restrictions on imports, such as anti-dumping, countervailing or safeguards

Goods covered by a tariff-rate quota:

Some products are covered by a tariff-rate quota. This allows a limited amount of a product to be imported at a zero or lower tariff rate.

The limit may be expressed in units of:

weight
volume
quantity
value

If this limit is exceeded, a higher tariff rate applies.

If there is a tariff-rate quota on your product, you can apply to import a limited amount at a reduced rate of customs duty.

Some tariff-rate quotas are only applicable to products imported from a specified country.

Please follow the below link to check the tariffs that will apply to goods you import from 1 January 2021.

https://www.gov.uk/check-tariffs-1-january-2021

If you need any help or support please contact us.

china usa

U.S. and China Near Deal That Could End Most U.S. Tariffs

The U.S. and China are close to a trade deal that could lift most or all U.S. tariffs as long as Beijing follows through on pledges ranging from better protecting intellectual-property rights to buying a significant amount of American products, two people familiar with the discussions said.

Chinese officials made clear in a series of negotiations with the U.S. in recent weeks that removing levies on $200 billion of Chinese goods quickly was necessary to finalize any deal, said the people, who weren’t authorized to talk publicly about the deliberations. That’s the amount the Trump administration imposed after China retaliated against the U.S.’s first salvo of $50 billion in tariffs that kicked off the eight-month trade war.

One of the remaining sticking points is whether the tariffs would be lifted immediately or over a period of time to allow the U.S. to monitor whether China is meeting its obligations, the people said. The U.S. wants to continue to wield the threat of tariffs as leverage to ensure China won’t renege on the deal, and only lift the duties fully when Beijing implemented all parts of the agreement.

As part of the ongoing talks, the U.S. asked the Chinese not to retaliate or bring World Trade Organization cases in response to U.S. tariffs that could be imposed to enforce the deal, according to a person familiar with the negotiations.

Stocks in Europe and Asia advanced on optimism about a deal, with the Stoxx Europe 600 Index rising 0.4 percent. The offshore yuan gained 0.2 percent.

Dates for a summit between President Donald Trump and counterpart Xi Jinping have yet to be agreed, according to officials from both countries who declined to be named. The Wall Street Journal, which reported earlier that the U.S. and China were close to finalizing a trade pact, reported the summit could happen around March 27.

Plans for a signing ceremony have been complicated by Xi’s need to lead China’s annual National People’s Congress and to make other foreign trips.

U.S. and Chinese officials “have conducted fruitful and intensive consultations and made important progress on many issues of common concern,” Zhang Yesui, a spokesman for the National People’s Congress, the annual session of China’s legislature, told reporters in Beijing on Monday. “We hope that the two sides will continue to hold consultations and reach a mutually beneficial and win-win agreement,” he added.

China’s Offer

China is offering to lower tariffs on U.S. farm, chemical, auto and other products, the Journal said, citing people familiar with the situation. Specifically, China would buy $18 billion in natural gas from Houston-based Cheniere Energy Inc., one of the people familiar with the matter said.

As part of a deal, China is pledging to speed up the timetable for removing foreign-ownership limitations on auto ventures, and to reduce tariffs on imported vehicles to below the current rate of 15 percent, the newspaper reported.

A senior administration official cautioned on Sunday that a decision had not yet been made over lifting the U.S tariffs. The official also said a debate was continuing inside the administration with Trump unlikely to make a decision before a deal was closer to being done, likening to situation to the debate over what to do with U.S. sanctions in the lead-up to last week’s summit with North Korea’s Kim Jong Un.

Asked during a congressional hearing last week whether a deal would see a lifting of U.S. tariffs, Robert Lighthizer, the China hawk now leading the talks with Beijing, would say only that was China’s desire.

Source: Bloomberg.com