European cars subject to 10% import tariffs from 2021

UK will default to World Trade Organisation rules from 1 January 2021 unless a a free trade agreement is struck with the EU

Dacia Duster row

European cars imported into the UK will be subject to the same 10 per cent tariffs as those brought in from other countries from 1 January 2021, unless a free trade agreement (FTA) is struck with the EU before then, the Government has confirmed.

Unless the Brexit transition period - which is due to end on 31 December this year - is extended, the UK and EU have what’s left of this year to negotiate an FTA and prevent the UK completing its departure on World Trade Organisation (WTO) terms.

If the UK does leave on WTO terms, the zero per cent tariff on cars imported from the EU will be scrapped in favour of the default 10 per cent levy. In most cases, the bill for this will likely be footed by British motorists buying European cars rather than manufacturers. The Society of Motor Manufacturers and Traders previously warned a no-deal Brexit would add around £1,500 to the cost of an average new car.

It is possible that the UK could strike an FTA with the EU at a later date to change this, though. Furthermore, post-Brexit Britain will be able to send its own representative to the WTO, meaning FTAs could be struck with other big car-making countries, such as the US and Japan.

Although European cars are looking likely to become more expensive, the Government is removing tariffs on £30 billion worth of other imported products.

Liz Truss, Secretary of State for International Trade, said: “For the first time in 50 years, we are able to set our own tariff regime that is tailored to the UK economy.

“Our new global tariff will benefit UK consumers and households by cutting red tape and reducing the cost of thousands of everyday products. With this straightforward approach, we are backing UK industry and helping businesses overcome the unprecedented economic challenges posed by coronavirus.”

Is the current Brexit transition period putting you off from buying a new car? Let us know in the comments below...

Recommended

Tory no-show at ‘fair fuel prices’ debate sparked by 102k-signature petition
News

Tory no-show at ‘fair fuel prices’ debate sparked by 102k-signature petition

As the public calls for action, the treasury points to ‘savings’ from a 2010 fuel price escalator freeze
24 May 2022
Speeding to be recorded as a cause of many more car accidents
Police car on scene at accident
News

Speeding to be recorded as a cause of many more car accidents

New police guidance for reporting will see a big rise in speeding recorded as a cause of car crashes
17 May 2022
World’s car bosses fear supply chain crisis will slow electric car production
Production line
News

World’s car bosses fear supply chain crisis will slow electric car production

Leading industry figures warn of looming problems at Financial Times’ Car of the Future Summit.
13 May 2022
Privately owned e-scooters to be legalised for use on public roads
E-Scooters
Consumer news

Privately owned e-scooters to be legalised for use on public roads

Transport minister announces plans to create new vehicle category for e-scooters as part of upcoming Transport Bill
12 May 2022

Most Popular

Best motorhomes 2022: the top 5 picks for all budgets
Chausson motorhome
Tips & advice

Best motorhomes 2022: the top 5 picks for all budgets

In the market for a new motorhome? Here are our top-five recommendations...
18 May 2022
New all-electric Volkswagen Aero B saloon to rival Tesla Model 3
Volkswagen Aero B exclusive image - front
Volkswagen

New all-electric Volkswagen Aero B saloon to rival Tesla Model 3

The new four-door VW Aero B EV could come with up to 435 miles of range and our exclusive images preview how it could look
20 May 2022
New Kia Niro EV prototype review
Kia Niro EV  prototype - front
Kia Niro

New Kia Niro EV prototype review

We get behind the wheel of a pre-production prototype version of the 201bhp Kia Niro EV
22 May 2022