Thread by @NicoleSykes_

Been thinking a lot about tariffs this week.

Because we’ve been on a journey with tariffs right? (1/9)

They were kind of the first thing people understood were economically bad in Brexit. We’ve had the pretty huge offer of zero for zero tariffs in an FTA early on, the curveball of the no deal tariff schedule and the Article XX1V nonsense, all set against the US-China drama (2/9)

And the arguments are so well-rehearsed I could vomit with boredom.

“The average EU tariff is only 3%!”
“Yeah but on food it’s 22%”
“Tariffs don’t apply to services, IT, medicines”
“But they do apply to 90% of our goods exports by value”
“They’ll be offset by the exchange rate"

And of course, my personal favourite:
“We’ll scrap tariffs on all imports to reduce prices for consumers.”
“That’ll destroy our manufacturing industry. You’ll literally said that, yourself, outloud, with your mouth, and also on paper.” (4/9)

But the reason it’s on my mind this week comes from @CBITweets no deal tour, and the 6 roundtables we’ve held in the last 48 hours. It’s come up A LOT. And I mean… A surprising amount given where we are (5/9)

@CBItweets We’ve all fallen so far into the detail, of sector-specific regulations, of REACH registrations and Single Administrative Documents and equivalence of various sorts and AEOs and notified bodies... But a bunch of companies have taken us back to basics this week (6/9)

@CBItweets It's this basic.

For the business selling clothes, a tariff of 12% will tip it into losses.
For the materials company that’s calculated tariff costs of £1.5million, it'll halve its profit margin of £3million (7/9)

@CBItweets For the leather firm, a 6.5% tariff will wipe out their profit margin.
For the automotive company, a 10% tariff will wipe out its 3% profit margin.

That basic. Before you add anything else (8/10)

@CBItweets So sure, it’s not always the most important issue for a lot of companies (lest we forget, if UK exporters face just half the non-tariff barriers US firms do trading with the EU, it’ll cost the equivalent of a 6.5% tariff on average) (9/10)

@CBItweets But we can all agree that casually wiping out companies’ profit margins is… not great right?
Because it makes giving pay rises and employing more people... not super easy?
I’m still so baffled that this is something we seem to be willingly choosing to do (10/10)