Fiscal incentives to support transport and logistics businesses and promote investment are vital as the UK navigates the uncertain Brexit transition period, according to accountancy firm Menzies LLP.
Despite the Confederation of British Industry (CBI) announcing a “welcome lift in business confidence” at the start of 2020, the Government can’t afford to neglect the needs of SME businesses, the backbone of the UK economy, it says.
Sean Turner, indirect tax senior manager and transport and logistics sector specialist at Menzies LLP, said: “The administrative burden on transport operators involved in cross-border activities is mounting as the industry prepares for the realities of Brexit.
“To alleviate this pressure, the Government should reset the timetable for the introduction of the new Customs Declaration Service, which according to the most recent round of IT tests, is not yet ready to go live.
“The latest information suggests that the current CHIEF 9 Customs Handling of Import and Export Freight) system could be phased out as early as September 2020, although this could be postponed beyond this date, and operators are concerned that they won’t have access to right software to process declarations.
“There is growing consensus that the current CHIEF to CDS migration schedule set by HMRC is unachievable.”
The Chancellor should also consider introducing new fiscal incentives to help the freight and logistics industry to get through Brexit, says Menzies LLP.
Turner explained: “Businesses in the sector are concerned that they lack access to skilled people capable of providing customs declaration services.
“After Brexit, this skills shortage could severely impact the industry, as the volume of customs declarations (c. 55 million per year) could increase five-fold.
“The Government has already introduced grants to subsidise the training of customs declaration specialists by businesses or industry intermediaries. However, more could be done in this area – for example, a targeted fiscal incentive could be introduced, making any capital investment by operators in training initiatives tax deductible.”