lorry next to customs sign at French terminal

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Many UK companies “are usually not even near being prepared for a no-deal” Brexit, figures seen by Newsnight recommend.

In February, HMRC launched the Transitional Simplified Procedures scheme, aimed toward easing imports within the occasion of the UK leaving the customs union and single market abruptly.

Lower than 10% of the companies estimated to require the standing had utilized for it as of 26 Might, Newsnight has discovered.

HMRC stated it could “guarantee border processes are as easy as potential”.

The Transitional Simplified Procedures (TSP) would enable UK companies to import items from mainland Europe with out filling out new customs declarations on the border. UK companies would even be allowed to postpone the cost of import duties for one 12 months.

However figures present that solely 17,800 companies had utilized for the TSP as of 26 Might. That is lower than 10% of the entire of 240,000 companies estimated to require the standing by 31 October, when the UK’s newest Article 50 extension is because of expire.

“If it actually is that this low we’re far, distant from being day one no-deal Brexit prepared – it is a very low quantity,” stated Mike Spicer from the British Chambers of Commerce.

“The TSP knowledge is horrible,” stated Matt Griffith of the Bristol Chamber of Commerce.

“The highest stage lesson is that the majority small companies are usually not even near being prepared for a No Deal state of affairs.”

A Cupboard observe leaked to the Financial Times on Wednesday reveals ministers have been warned that it could take “at the least 4 to 5 months” to enhance dealer readiness for brand spanking new border checks.

It additionally means that officers are contemplating “monetary incentives to encourage exporters and importers to register for brand spanking new schemes”.

In the meantime the main Conservative management candidate, Boris Johnson, has promised supporters the UK will leave the EU with or with out a deal on 31 October, ought to he change into prime minister.

Earlier than companies can register for TSP they’ve to use for an ‘Financial Operator and Registration Identification’ (EORI) quantity from HMRC.

UK companies which have solely ever traded contained in the EU won’t have an EORI quantity. However within the occasion of no deal, an EORI quantity will probably be a primary authorized requirement for corporations to have the ability to import and export.

Up to now 69,000 companies had signed up for EORI standing by 26 Might – lower than a 3rd of the 240,000 EU-trading UK companies estimated to want one, the figures seen by Newsnight present.

In February, then monetary secretary to the Treasury Mel Stride, urged companies in opposition to leaving issues “till the final minute”.

In September 2018, December 2018 and January 2019, HMRC wrote on to 145,000 VAT-registered companies that solely commerce with the EU advising them to use for an EORI quantity.

However there are an extra 95,000 non-VAT registered corporations that HMRC stated additionally wanted to take motion, bringing the entire to 240,000.

HMRC says that it solely takes companies 10 minutes to register for an EORI quantity on-line and claims it has the capability to enroll 11,000 companies per day.

However the British Chambers of Commerce and the Federation of Small Companies have stated that HMRC ought to mechanically concern EORI numbers to corporations that want them, quite than ready for them to use.

An HMRC spokesperson stated: “HMRC has well-developed plans to make sure that on day one in every of a no-deal state of affairs there will probably be a functioning customs, VAT and excise system. While this technique will probably be practical, it’s one which we’d look to enhance in the long run.”

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