HMRC says Brexit "max fac" customs arrangements would cost business £17bn-£20bn a year. The "streamline" option (the one Boris calls 'crazy') costs nothing
Jon Thompson, HMRC perm sec, said this to the TSC. HMRC has also reiterated that neither option will need infrastructure at the Irish border for fiscal purposes (that's HMRC's job - agricultural standard checks, should they be needed, would be DEFRA's job, for example)
Thompson arrived at his £17-20bn number like this. In 2016, there were "almost 200m intra-EU consignments". Outside EU they will need customs declarations at a cost of £20-£55 each. HMRC takes a £32.50 average. That's £6.5bn.
Double that as EU customs declaration forms have to be completed as well. That's £13bn. "Then you've got the question about what might be the payments for the EU rules of origin checks. Difficult to estimate but reasonable to think several billions more".
The HMRC's proposed New Customs Partnership would avoid all customs declarations. So no cost.
But it's worth remembering that the EU have ruled out both models. And the NCP is the HMRC's snazzy idea - so they have skin in the game on that. It also faces massive technological hurdles
Another downside, as @ChrisGiles_ points out. Brussels does not plan to reciprocate the NCP deal. So the UK may have to forgo import tariffs for goods that arrive in the EU on their way to the UK. Or there will have to some other complex bureaucracy
Asked whether the EU has agreed to collect the tariff for goods destined for the UK that arrive in the EU, Thompson said: “That’s one of the moving parts of the negotiations. I do not believe that we would expect them to reciprocate.” He said it would not stop the system working.
Basically neither is great. Both have costs.
