£933 richer outside the EU? Not so fast...


Lower taxes, cheaper food and cheaper clothes are among the things Business for Britain's "Change, or go" promises you if the UK leaves the EU. 




Sounds too good to be true? That's because it is. Let's run through the problems with Business for Britain's calculation.


1. Stopping Britain's payment into the EU budget: £9bn saved


Unless you would want to leave the EU single market entirely - which would be distastrous - the UK could not simply keep the money it currently contributes. To continue to trade freely with EU countries, Britain would have to join the EEA or EFTA after leaving the EU - both of which come at a cost. In the case of Norway (EEA), it is almost as much as the UK pays per capita.


2. Leaving the Common Fisheries Policy: £2.8bn saved


While it is widely acknowledged that the EU's Common Fisheries Policy is far from perfect, the issue with this figure lies once more with Business for Britain's confidence in predicting future government legislation.

"Change, or go" admits as a "caveat" that there is no telling what a future fisheries policy would look like, that fishermen with existing access to British fishing grounds will likely continue to have access, and that it may take generations for financial gains to materialise - but is quick to point out that at the same time it would save us all £2.8bn.


3. Ending "EU burdens passed through Council Tax": £500m saved


On VAT, Business for Britain's report arbitrarily picks five areas and assumes that the UK government would scrap tax on them entirely if it left the EU. It then goes on to assume that government would eliminate tax on petrol, beer and wine among others, simply because it left the EU.

But there is more: safe booster seats for children? Tachometers in buses? Business for Britain identifies these measures as an attempt by the EU to increase your Council Tax. Needless to say it is assumed that a post-Brexit government would not hesitate to scrap these requirements! After all, who wants to know how fast or far a bus is going when we could be free of these "increased operating costs"?


4. Lower product shelf prices as a result of leaving the EU: £5 saved per person


Have a look at Business for Britain's criticism of the Waste Electrical and Electronic Equipment Recycling Directive. The theory goes that eliminating the regulatory cost of reducing waste output will result in cheaper product prices for all of us. But has it not occurred to the authors that firms also have to pay for waste disposal and recycling, which would also be reflected in consumer prices? We will leave it to Business for Britain's experts to hypothesise on this one...

If that is not enough to undermine the reliability of the figure, page 825 of "Change, or go" points out that "once again, there is no easy mechanism for translating potential UK savings in these areas into a cohesive single assessment" - before going on to do it anyway. In other words: They simply have no idea, but they gave it a shot anyway.


5. Leaving the EU results in cheaper clothes: £146 saved per person


"Change, or go" itself points out prominently that this figure is speculative. Business for Britain assume a 12% reduction in all clothing costs, citing tariffs. However not all clothing imports face a 12% tariff, and so the calculation is unreliable. For example, importing gloves from India would only face a 7.6% tariff.

It also assumes that British government would get rid of all import tariffs, which could trouble domestic production and swamp the market, making competition for brands like Burberry harder if not impossible. 

Besides this, to leave the common customs tariff would mean a tariff on every import and export between the UK and EU member states, resulting in immense costs for British manufacturers.


Looks like Business for Britain's £933 promise is an empty one.



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