Experts are currently warning of the financial impact that a no-deal Brexit will have on the finances of households across the country. As the UK currently sources around one quarter of its food imports from the EU, the impact a no-deal Brexit would have would almost certainly result in an increased cost to households as the UK is faced with tariffs on food imports.
Despite claims from the Government that new trade deals will in fact lower the cost of imports (and certainly this will be true of imports from Japan), the lack of a free trade deal between the UK and the EU has analysts predicting that the average UK household can expect prices to increase.
Whilst the government continues to rebuff these findings with claims that the EU are ‘protectionist’ when it comes to agricultural imports and freedom from the EU’s customs union will leave the UK able to benefit from cheaper imports, the UK Trade Policy Observatory and the Resolution Foundation have found that this won’t make up for the increase on tariffs we face on EU dairy and oil imports which could be as high as 8 percent, meat tariffs could go up by 6 percent and fruit and vegetable tariffs could might increase by 3-4 percent.
In the event that the UK does manage to secure a free trade deal with the EU, experts warn that we could still be looking at an increase in prices due to new border bureaucracy and checks. In fact a study conducted at both Warwick and Bristol universities concluded that this increase in price with a Brexit deal could be as much as 6 percent.
Either way, it’s not looking likely that any trade deal will result in lower prices for British households.
Peter Field is a financial analyst and has written for InvestingReviews.co.uk covering topics from pensions, savings, investments and ISAs. His knowledge of the Investment market has proven invaluable, making his unbiased views and opinions open and honest for everyone. In 2021 Peter retired and is working towards enjoying more of the outdoors with his beloved labrador Millie.