One of the developing themes relating to Brexit is how we, or rather HMRC, will cope with the increased volume in traffic, particularly as it might relate to import declarations and subsequent customs duty and import VAT payable by UK businesses and individuals.
In this respect, the Public Accounts Committee has recommended that HMRC should ensure that the new Customs Declaration Service (CDS), should have the capability to handle 255 million customs declarations each year, as well as the flexibility to cope with the changes to tariffs, free-trade agreements and international trade quotas that a post-Brexit environment may bring.
However, while a fully functioning CDS may reflect the PAC’s recommendations, it does not, at face value, address the important interaction between the Border Force and HMRC.
As anyone travelling through a port or airport will be aware, the Border Force is the first ‘line of defence’ in carrying out immigration and customs controls for people and goods entering the UK, including patrolling the UK coastline and searching vessels.
The Border Force has however very limited powers and, having made an intervention, needs to contact HMRC to take matters further.
With HMRC undertaking a significant transformation in reducing its current estate to just 13 regional centres and five specialist sites, many UK ports and airports controlled by the Border Force will be a significant distance from the nearest HMRC office.
There will, for example, be no HMRC office north of Glasgow and Edinburgh, no HMRC office in the south-west of England (other than Bristol, which isn’t exactly in the south-west). With the Southampton office closing there will be no HMRC office along the south coast, and with the Ipswich office closing there will be no HMRC office in the immediate vicinity of Felixstowe and Harwich.
Consequently, where the Border Force has made an intervention requiring an HMRC officer to take the next step – day or night – the vast distances that HMRC officers may have to travel will inevitably result in delays in processing imports.
Therefore, although the new Customs Declaration Service might be able to cope with increased demand post-Brexit, it doesn’t necessarily follow that the Border Force and HMRC will be able to.