The introduction of post-Brexit customs checks could cost traders up to £9bn a year, according to a think-tank report.
The Institute for Government said in its study that the introduction of customs declarations will affect up to 180,000 traders who now operate only within the EU.
Those traders face making customs declarations for the first time after Brexit, and the Government estimates an expected extra 200 million a year.
Those declarations cost £20 to £45 each, the institute said, putting the total additional cost at £4bn to £9bn.
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The Government wants to leave the EU customs union when it leaves the bloc in March 2019 – and it wants to negotiate a new relationship that will ensure trade is as free of friction as possible.
It has called for a transition period where customs arrangements will remain largely the same as they are now. But its commitment to leave the customs union has raised concerns that customs checks will be introduced at UK borders, increasing costs for businesses.
“The scale and cost of change for many traders could be significant. Government must engage with them in detail about changes, understanding their requirements and giving them as much time to adapt as possible,” the report said.
The IfG said preparing the border for Brexit is a “huge task with a hard deadline”, and will require the Government to “orchestrate change across more than 30 government departments and public bodies, as well as over 100 local authority organisations”.
In addition, a “complex web” of private sector organisations must also be ready so trade can continue to flow across the border on day one after Brexit, the report said.
To avoid a cliff-edge, the Government must make sure everyone from port operators to freight companies and local authorities is ready, the IfG said.
It should also work with EU partners to ensure issues at European ports do not cause significant disruption to supply chains.
The issue is “particularly vital” in the case of the Irish land border, although the Government has insisted there will be no return to a “hard” frontier, the report said.
Video: Plans to keep trade moving after Brexit
A spokesman for the Department for Exiting the European Union said: “In August the Government set out its proposals for a new customs arrangement that will facilitate trade between the UK and the EU that is as free and frictionless as possible.
“We are pursuing a smooth and orderly transfer that gives businesses time to prepare for the new arrangements.
“The new system will enable close cooperation with our European neighbours and open up opportunities for industry to expand their markets globally.”
Source: Sky News