A disorderly Brexit would disproportionately hit small firms in the UK, the Federation of Small Businesses (FSB) has warned, noting that many are worried about being faced with any form of customs declarations.
According to the FSB, 59% of small businesses that export goods to the EU Customs Union worry that trade would be impacted if overall costs increased as a result of having to complete additional customs declarations.
One in 10 (11%) of smaller firms say that this would cause them to stop exporting to the EU altogether.
FSB National Policy Chairman, Martin McTague, is urging the Government to use the summer as an opportunity to intensify negotiations with the EU in order to deliver a “pro-business Brexit” based on easy trade, access to talent and a transition period.
The last of these is particularly important, he explained, to ensure that small firms are only facing one set of changes so that they can continue to operate broadly as they do now until 31 December 2020.
“Smaller businesses, and those businesses they rely upon, simply don’t have enough time to prepare for a cliff-edge Brexit,” Mr McTague warned. “It cannot be forgotten that smaller firms, unlike bigger businesses, do not have the capacity or resources to make adequate contingency plans to soften the impact of this scenario.”
While FSB welcomes the fact that the Government’s proposed Facilitated Customs Arrangement model will not entail any customs declarations, it points out that there are still many questions unanswered on how the newly proposed arrangements would work.
This is particularly the case for those smaller businesses that do not know the ultimate destination of their imported goods at the point of import.
