Boris Johnson’s new deal ditches Brexit backstop, allows us to strike trade deals and ends EU law
BORIS Johnson’s new Brexit deal ditches the Northern Irish backstop, allows us to strike our own trade deals and ends EU law. The PM believes his “great” agreement allows Britain to “take back control” – compared to Theresa May’s previous plan. REPLACING THE BACKSTOP The backstop has been the main stumbling block to negotiations with […]
BORIS Johnson’s new Brexit deal ditches the Northern Irish backstop, allows us to strike our own trade deals and ends EU law.
The PM believes his “great” agreement allows Britain to “take back control” – compared to Theresa May’s previous plan.
REPLACING THE BACKSTOP
The backstop has been the main stumbling block to negotiations with the bloc with Mr Johnson refusing to do any deal that included it.
But it has now been replaced by a four-point plan relating to: customs, regulations, VAT and the consent of the Northern Ireland Assembly – known as Stormont.
According to the new proposals Northern Ireland will leave the customs union with the rest of the UK.
This is important because it means the province will reap the benefits from trade deals brokered by No10 after Brexit.
There will be a legal customs border between Northern Ireland and the Republic.
But in practice the border will be between the UK and the island of Ireland – with goods being checked at “points of entry” in Northern Ireland.
REGULATION
Products entering Northern Ireland from EU countries – known as the single market – will be subject to tariffs.
But this only applies if they are not set to go across the border.
If goods leave Northern Ireland and enter the single market, then the UK will pay tariffs to the EU.
This would mean putting a “border in the Irish Sea” which would result in checks at major ports – but not affecting individual travellers.
EU RULES
All references to the Level Playing Field – staying close to EU rules – have been stripped out of the Withdrawal Agreement.
In the Political Declaration, which is not legally binding, the UK and EU endeavour to draw up a new mechanism as part of an FTA “commensurate with the scope and depth of the future relationship”.
But we will have to stay in line with EU conventions on climate, environment and workers’ rights as part of a new trade agreement.
The political declaration states that: “Given the [European] Union and the United Kingdom’s geographic proximity and economic interdependence, the future relationship must ensure open and fair competition, encompassing robust commitments to ensure a level playing field.
“These commitments should prevent distortions of trade and unfair competitive advantages. To that end, the parties should uphold the common high standards applicable in the Union and the United Kingdom at the end of the transition period in the areas of state aid, competition, social and employment standards, environment, climate change, and relevant tax matters.”
But as this isn’t legally binding, it could be changed later.
VAT
The deal requires Northern Ireland to comply with EU rules on VAT and excise duties – but Britain will have to collect them on behalf of the bloc.
VAT exemptions and reduced rates applied in Ireland will also be exercised in Northern Ireland, by the UK government.
Brussels grants a change allowing the UK to set different VAT rates in Northern Ireland and Great Britain on sanitary products. This means the tampon tax can be abolished in Great Britain.
CONSENT
In the new plans the Stormont Assembly members will not be able to vote on continuing the Brexit arrangements until four years after they come into effect in 2021.
The vote will be a head count, with a majority keeping the arrangements in place for another four years.
If the proposals get consent from both unionists and nationalists then they will be kept in place for another eight years.
This would not allow the DUP a chance to veto.
However, if the majority vote to come out of the EU arrangements there would be two-year period until this takes place.
TRADE DEALS
Under the new agreement the UK, and Northern Ireland, will be free to sign its own trade deals.
London and Brussels are aiming for a zero-tariff deal with unlimited quotas in the future.
EU BILLS
Under the new treaty the UK will have to pay its financial obligations to the EU.
There is currently no exact figure on how much the divorce bill will be.
However, it will include the UK’s contributions to the EU’s budget for 2019 and 2020.
The bill could be around £33billion, the Office for Budget Responsibility estimates.
About three quarters of this will be paid by 2022, the OBR expects.
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