The European Union may be planning to demand the United Kingdom pay a €2 billion customs fraud charge before agreeing to a Brexit deal, on top of a mooted €60 billion “divorce bill”.
According to reporting by The Times, Eurocrats believe that Britain has been serving as a gateway into the EU market for foreign crime gangs, operating mainly from China.
The gangs target Britain, the newspaper believes, because the authorities allow them to declare imports at “impossibly low values”.
For example, EU anti-fraud agency OLAF claims the average value declared at the UK border for women’s cotton trousers is €0.91 per kilogramme, compared with an EU average of €26.09.
“Suspicious shipments” of clothing to Britain from China increased from 192 million kg four years ago to more than 407 million kg last year – with 86 per cent of the product then being re-exported to Continental Europe tariff-free.
“This fraud is still going on and Britain knows,” a European Commission source told the newspaper. “It will come up in trade discussions and it will have an impact on the future customs relationship between the EU and Britain.”
EU member-states do not control their own international trading arrangements, being barred from striking bilateral trade deals and required to levy a Common External Tariff on imports from outside the bloc.
As a certain percentage of the revenue from customs and excise duties must be set aside for the EU budget, its agencies are keen as much money as possible is collected.
Labour MP Meg Hillier, who chairs the House of Commons Public Accounts Committee, has said the HMRC “needs to get on top of [customs fraud] because Britain is now seen by these crime gangs as the soft underbelly of Europe.
“Water finds the easiest route and fraudsters also look for the easy way,” she added claiming that her committee had “been concerned that HMRC have been slow to act”.
HMRC told The Times that OLAF’s numbers were “not recognised” by its own officials, and that it “does not hesitate” to prosecute genuine cases of customs fraud.