Jeremy Hunt, the Health Secretary has responded to warnings by BMW and Airbus which claimed that the Brexit uncertainty could jeopardize investments in the UK. Mr. Hunt termed such warnings as entirely appropriate. He added that the Brexit discussions were at a critical moment and the best thing would be to rally behind Theresa May in delivering the best possible Brexit.
Last week, Airbus threatened to leave the UK if Britain decided to leave the single market as well as the customs union without a deal of transaction. The BMW followed suit by indicating that there was a need for clarity over Brexit come the end of summer. Ian Robertson, BMW UK boss stated that clarity on the Brexit issue would help them begin making contingency plans which may result into a less competitive UK in an increasingly competitive world.
The Customs Union comprises of 28 EU members where they all pay similar duty rates on non-EU goods. Theresa May has ruled out the chances of being part of the customs union as soon as the UK exits the EU come 29th March, 2019.
In its Brexit risk assessment, Airbus said that if the UK proceeded to exit the EU without a transaction deal, there would be severe disruption of the UK production industry. Airbus has been one of the companies that has relayed worry and distress concerning the current direction of the government.
In an interview with the BBC, Rebecca Long-Bailey, Labour’s shadow business secretary said that she has been told by business leaders in the UK that if the government opted for a “no transaction deal”, the move would finish them and they would be compelled to close their sites.
International trade Secretary Liam Fox says that it is right for companies to worry about the “no deal” for Britain but the move would also affect Europe.
Concerning the tax question, Mr. Hunt failed to give clear details on how the government intends to fund its pledge to pump an additional £20bn into the NHS. He also declined to rule out the scrapping of the manifesto pledge made by the conservatives in 2017 to cut corporation tax to 17 percent by 2020.
The government had pledged to reduce corporation tax to 17 % and that would have given Britain one of the least tax rates on firms’ profits in the G20. That explains why businesses welcomed the pledge warmly. However, all that could be in jeopardy as the Health Secretary refused to confirm whether the corporation tax cut would proceed especially now that the NHS has been promised an additional £20bn from next year.