On 19 May 2020, the Government announced an important change to what levels of tariffs and quotas will be applied to goods imported into the UK, by the publication of a new UK Global Tariff (UKGT) – which has been lodged with the World Trade Organisation (WTO). UKGT will replace the UK’s reliance on the EU’s Common External Tariff and will take effect from 1 January 2021.

The new tariff is aimed at encouraging trade to the UK by assisting UK businesses to make it simpler and cheaper to import goods from overseas. Its aim is to streamline and simplify some of the existing tariff lines and rates which the UK feels are onerous and complex. It will remove tariffs on a number of products, simplify complex duty calculations and abolish additional levies on certain types of goods.

The new UK Global Tariff will:

  • Reduce some duty rates to 0% – for example, pianos (reduced from 4%), dishwashers (reduced from 2.7%), cocoa powder (reduced from 8%) and Christmas trees (reduced from 2.5%).
  • Round down or ‘band’ some duty rates – for example, hairbrushes (reduced from 3.7% to 2%), ballpoint pens (reduced from 3.7% to 2%) and golf clubs (reduced from 2.7% to 2%).
  • Remove duty rates below 2% – for example, circular saws (currently 1.7%) and poultry incubators (currently 1.7%).

The UKGT will apply to all goods imported into the UK unless:

  • An exception applies, such as a relief or tariff suspension.
  • The goods come from countries that are part of the Generalised Scheme of Preferences (GSP).
  • The goods are imported from countries which have a trade agreement with the UK.

Of equal importance is that Common Agricultural Policies (CAP) duties will also be removed on prepared foodstuffs (for example, frozen food and ready meals) which contain lactose, starch and proteins. This will greatly reduce costs to businesses in those sectors.

The new UK Global Tariff represents a significant move forward towards the end of the transition period. We would encourage businesses to reignite their cost and business planning models ahead of 31 December 2020 to ensure they account for an additional savings as a result of the introduction of the UKGT.

If you have any queries or would like further information regarding the above, please contact Lucy Sutcliffe, National Customs Duty Director.


The information in this blog should not be regarded as financial advice. This is based on our understanding on 19 May 2020. Laws and tax rules may change in the future.