The HMRC's UK tax chief claims that a no-deal Brexit will cost UK and EU businesses up to £20bn
Jon Thompson, Chief Executive of the HMRC has told MP's that having a no-deal Brexit arrangement will cost in the same regions as the up to £20bn "max-fac" (maximum facilitation) border arrangements fees that the Brexiters support. What does this mean? It means that all imported and exported goods/services will require custom declarations.
David Davis' surprise resignation together with a few of his party followers only enhances the fear that all small to medium size businesses are feeling, that a no-deal Brexit is extremely likely and is a harrowing thought. And the impact from a no-deal Brexit hugely effects these sizes of companies.
The reality is that many small and medium size businesses simply will not be able to afford the kinds of duty costs that will be levied and unfortunately will go bankrupt. Jobs will be lost, supply chains will be disrupted (like in the 1970s with the car industry that is already currently being affected by Brexit) and every sector of our economy will feel the impact. Inevitably the extra costs will then be passed on to consumers who will struggle to find the money to afford commodities and previously affordable leisure products. Jobs will go down, prices will go up. Lovely.
Richard Reed (Co-Founder of Innocent Drinks) quoted the following from an article in The Guardian in May 2018 which matches the feeling of uncertainty and distain that the majority of UK people and especially business owners are feeling, "We’ve seen our economy go from the fastest growing in the G7 before the referendum to the slowest growing in the developed world today. The value of the pound has collapsed, well-known companies have disappeared and the Bank of England has calculated that real household income is now £900 lower than predicted before the referendum. The Brexiters are driving our country towards a cliff edge and trying to pretend the brakes don’t work, and that there’s nothing any of us can do about it".
Of course, a solution to this entire problem is for a second Brexit vote to occur so that the UK people can democratically determine the terms of Brexit to include remaining in the EU, but the chances of that happening are extremely slim. We could have an early general election prompted again by a feeling of uncertainty, lack of trust and dissatisfaction towards to last two years of unacceptable Brexit plans and negotiations. Even previously pro-leavers are now becoming strong-remainers as a result of this poorly handled Brexit debacle that ripples through the lives of every UK citizen and business owner.
Ensuring you can thrive and not die throughout these serious trials and tribulations is cash. Keeping as much cash in your pocket and in your business is key to floating through these rough and challenging times. Ensuring all of your debtor invoices are paid timely and in full is priority as is ensuring good creditor management as well.