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The question for the EU: UK moves to give a special/unique economic status to territory of NI (in terms of barriers to UK internal market on SPS+) because of GFA, so will it?
In previous negotiations the EU has insisted on regulatory alignment on all industrial goods regulations, an enforcement role for European Court of Justice and Northern Ireland’s inclusion it customs territory, in terms of collecting duties such as VAT
Many European governments struggle to collect VAT, with half the EU’s 28 member states, including the UK, recording a “gap” between expected revenue and collected duties of over 10 per cent
If UK could keep non-collection down to a similar level in NI, show that it is serious about enforcement and accept independent arbitration of whether abuse is taking place, some European governments are ready to make concessions
Key countries are now ready to compromise if Britain can prove its plan for Northern Ireland will not lead to large scale abuse of single market and provide mechanisms to stop it
Reliable source: “If the hit on the single market is manageable, for example if abuse of the loopholes is manageable, or not bigger than the VAT gap most member states have, the EU will come round"
*Reliable European source
