Press

Failures at HM Revenue and Customs mean £42 billion in taxes have not been collected and people are being let down by poor customer service. What that could pay for? The annual tax shortfall caused by Brexit (Centre for European Reform).

De Britse denktank Centre for European Reform berekende dat de Britse economie sinds de uitstap 5,5 procent trager gegroeid is dan als het land in de EU gebleven was. Bovendien wordt het VK ook nog eens door een zware stakingsgolf ­geteisterd.

The Centre for European Reform says Brexit may have reduced UK goods trade by around 7% in the second quarter of 2022.

John Springford of the CER, tries to isolate the effect of Brexit by constructing a phantom country that tracked Britain’s performance before 2016’s referendum result. By using an algorithm to pick from a set of 22 countries rather than just selecting, say, a few economies of a similar size, he builds a plausible description of Britain’s path had it not voted to leave the eu (see chart 1). He estimates that by the second quarter of 2022, Brexit had hit gdp by as much as 6% relative to this counterfactual. Using the same method, he reckons that Brexit dragged down investment by 11%.

The Centre for Economic Performance reckons that including that "dynamic" effect of Brexit could increase its impact on potential output to a hit of between between 6.3% and 9.5%, and the Centre for European Reform suggests the impact may have been a shortfall by up to 11% of the output that might have been expected.

But so far, Britain's departure has, from an economic perspective, been unambiguously negative. You can take it with a pinch of salt if you like, but the Centre for European Reform recently estimated that UK GDP is 5.5pc smaller because of Brexit, which is equivalent to around £40bn annually in tax revenue, or enough to pay for virtually all of Liz Truss's doomed tax cutting agenda.