LONDON – The British government said Friday it will delay bringing in full border checks on goods coming from the European Union to relieve pressure on businesses hammered by the coronavirus pandemic. But the U.K. once again ruled out delaying its full economic break with the bloc beyond the end of this year.
The U.K. left the now-27-nation bloc on Jan. 31, but remains part of its single market for trade and other economic structures during a transition period that lasts until Dec. 31. After that, British firms trading with the EU will face customs checks, border inspections and — unless there is a free trade deal — tariffs.
The bloc is the U.K.’s biggest economic partner, accounting for about half of Britain’s trade. In February the U.K. government announced that goods coming from the EU would require inspections and customs declarations starting in January.
But on Friday the government said border checks would be introduced in stages. Importers of most goods will be able to delay submitting customs declarations or paying tariffs for up to six months, though they will have to keep customs records. From July 2021, traders will have to make full declarations and pay tariffs at the point of importation.
The government estimates that businesses will have to fill out 200 million new customs forms a year under the new rules.
The government also announced 50 million pounds ($63 million) to help set up a huge new border industry to deal with trade red tape, including customs brokers and freight forwarders. The U.K. says it will build new customs and border facilities for all the checks — a process that has been set back by the pandemic.
Britain’s economy is already reeling from the impact of the coronavirus pandemic. The Office for National Statistics said Friday that economic activity shrank by 20.4% in April, the first full month after a nationwide lockdown was introduced to slow the spread of the virus.
All areas of the economy were hit during the month, in particular pubs, education, health and car sales. The month-on-month decline was unprecedented and, adding the still substantial 5.8% decline in March, means the U.K. economy is around 25% smaller than it was in February.