UK tariff plan for no-deal Brexit will have limited impact on economy — OBR

Contingency plans published last week, to eliminate most tariffs but impose a 10 per cent duty on imports of cars and some animal products, drew a fierce reaction from industries that would face fiercer international competition and consumer groups that say some prices would rise sharply. However, OBR officials said the overall impact on the economy would be limited, and that the “real world” impact of tariffs would depend on how they were implemented and enforced, and how people changed their behaviour in response. Robert Chote, the OBR chairman, told MPs that the “dominant effect” would come from the tariffs imposed on cars — but added that there might be “quite considerable compliance challenges”. Given different rates for finished and unfinished vehicles, he added, one would need to ask if “all that was needed . . . would be to stick on a wing mirror”. Mr Bean said that tariffs would not necessarily affect domestic prices, because foreign producers might absorb the impact, and that because the plans published last week were quite “tightly targeted”, there might be “more scope to redefine a product so it falls into a different bucket”.