Food prices will soar on key supermarket items such as mozzarella, tomatoes and apples if the UK does not secure a transitional trade agreement, retail's industry body has warned.
If the EU and the UK fail to agree to maintain current tariff rates, trading of goods will come under the rules governed by the World Trade Organisation (WTO). This means tariffs on Italian mozzarella and Irish cheddar will jump to 45.5 per cent and 44.1 per cent respectively on the day the UK officially exits the EU.
Ray Symons, head of European and International Affairs at the British Retail Consortium (BRC) said: "If the UK and EU fail to reach an agreement...it is difficult to see how this couldn’t affect shop prices."
On some products, the effective tariff rate could sky-rocket by as much as 80 per cent, he said.
The BRC has argued that the UK government is unlikely to secure a detailed trade agreement with the EU by the end of the negotiating period, making a transitional trading arrangement essential.
"We think it’s going to be real challenge for the government to negotiate all the terms and have it ready to go by the date we’re suppose to leave," Symons said.
"We are ambitious for the government in this respect and optimistic that they will be able to deliver such a solution."
However, negotiations won't begin until a new government is installed after the General Election on June 8.
A UK government spokesperson said: “We are determined to get the best deal on leaving the EU, including for our world-leading food and drink industry. Securing a bold and ambitious free trade agreement with the our European partners is a priority, allowing for the freest possible trade in goods and services.
“At the same time, we are going to make the most of the opportunities that our departure presents; getting out into the world and doing business right across the globe.”
No deal: What will happen without a UK-EU agreement?
The BRC identified the items most at risk for the UK consumer, based on which products are imported in the highest volumes, and will have the highest tariffs under the WTO tariff schedule:
- Cheddar cheese from Ireland: 44.1 per cent tariff
- Beef from Ireland: 39.6 per cent tariff
- Apples from France: 15.5 per cent tariff
- Wine from France: four per cent tariff
- Tomatoes from the Netherlands: 21 per cent tariff
- Handbags from Italy: three per cent tariff
- Mozzarella from Italy: 45.5 per cent tariff