May weighs up remaining in an EU customs union

Theresa May is considering agreeing to keep the UK inside the EU’s tariff wall to secure a Brexit deal, which would restrict the country’s ability to do trade deals on goods but allow it to strike agreements on services. The move could satisfy the opposition Labour party’s demand that Britain stay within the bloc’s common external tariff. The prime minister has been warned by Conservative chief whip Julian Smith that unless she strikes a deal on a customs union with Labour a second referendum would be a likely outcome, prompting ministers to scramble to find a possible compromise. Mrs May insisted to MPs on Wednesday she wanted to maintain an “independent trade policy” after Brexit but her allies said that this did not necessarily cover all parts of the British economy. “You could come up with a solution where you have freedom to do trade deals in some areas but not others,” said one person close to Mrs May. Downing Street declined to comment.