In February this year the NI Tax Committee made a submission to the NI Affairs Committee’s Call for Evidence on Brexit and the NI Protocol. The submission sets out the extensive work carried out in 2020, which continues in 2021, by the NI Tax Committee and the Institute on post EU exit with HMRC and the UK Government. Engagement is also being undertaken with officials from the Department for the Economy, the Northern Ireland Office, and the Cabinet Office. In addition, the Institute is represented on the Secretary of State’s Business Engagement Forum.

The response to the NI Affairs Committee stresses that although the Protocol does bring challenges to businesses as they adapt to new rules, particularly in the midst of the pandemic, our engagement with businesses over the past few weeks in particular has shown that some feel many of the “unknowns” are becoming “knowns” and things are beginning to settle down as supply chains are reworked and bedded down.

The dual status of NI in both the UK and EU Single Market for goods gives a unique opportunity to the region in terms of attracting foreign direct investment, particularly in the manufacturing and distribution sectors.

The full consequences of the Protocol are unlikely to be felt until later this year, when the grace periods on customs checks are expected to be lifted on goods moving from GB to NI. The submission states that now is the time to create awareness and educate businesses about the customs compliance that is required when those grace periods end. Otherwise, the confusion seen in January 2021 will be repeated.

Overall, the submission highlights that certain issues do remain which are as follows: -

• The lack of practical guidance available to businesses and delays in issuing guidance.
• The late implementation of the Trader Support Service.
• GB supply issues.
• Confusion and difficulty understanding the rules of origin.
• The application of the “at risk” rules particularly in the cases of wholesaler arrangements.
• The need for customs declarations to return goods from GB to NI.
• NI group with companies in NI and GB experiencing difficulties moving goods and work between sites.
• The shortage of experienced customs intermediaries.
• The challenges presented by SPS checks and Export Health Certificates on goods moving between GB and NI; and
• The importance of a soft-landing approach to compliance.