British Retail Consortium warns government of price rises post Brexit

The British Retail Consortium has called on Government negotiators to put consumers first in the forthcoming Brexit talks by ensuring their sights are firmly set on keeping shop prices low once the UK leaves the European Union.

In a letter to Liam Fox, the Secretary of State for International Trade said that the Government’s strategy must focus on finding opportunities for lowering import costs as well as avoiding any increase in tariffs.

BRC chairman Richard Baker pelled out the importance of achieving trading arrangements with the rest of the world that do not put household budgets at risk.

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“We will be supporting the Government through this complex and difficult process, helping them analyse how increased cost pressures on retailers could mean higher shop prices and identifying any opportunities for new trade deals that could benefit individuals and families” he said, launching the BRC’s Brexit campaign.

“The retail industry is the UK’s biggest importer, and has huge experience of importing from every corner of the world. We will be engaged in a constructive dialogue with government that will bring our experience to bear on the Brexit talks to the benefit of everyone in the UK,” he added.

COST HEADWINDS

 While UK retailers have been very successful in insulating consumers from the cost of rising business rates and labour, the recent devaluation of the pound is compounding economic headwinds, the BRC said today, while years of deflation have left little margin to absorb added cost from import tariffs and administrative burdens.

The consortium also pointed out that a failure to strike a good Brexit deal by 2019 would have a disproportionately severe impact on retailers and their customers, because if the UK fell back on to World Trade Organisation rules the new tariff rates that the UK would apply to imports from the EU would be highest for consumer staples like food and clothing.

For example, the average duty on clothing and footwear would attract tariffs of 11-16% versus the current zero-rating for all EU imports.

The BRC said it will be campaigning with other industry groups for an early end to the uncertainty facing EU workers now residing in the UK and contributing to our economy.

It explained that the UK retail industry employs between 100,000 and 200,000 EU nationals, who, it says, make a huge contribution in every type of role from the boardroom to distribution centres and customer service.

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