Whitehall asleep as EU parcel tax and AI rules hit Northern Ireland

Ulster Unionist Windsor Framework spokesperson Dr Steve Aiken OBE MLA has welcomed the proposed UK-EU SPS agreement. He warned that new EU customs rules, the parcel handling fee and the application of parts of the EU AI Act will widen the gap between Northern Ireland and the rest of the United Kingdom.

Dr Aiken said:

“The proposed SPS agreement, which will align Great Britain with EU food and agriculture rules, is welcome news, especially for agribusiness in England, Scotland and Wales. However, these changes only cover regulation. They do not cover customs arrangements or tariffs, both of which continue to apply in Northern Ireland. I hope this new alignment will reduce the considerable friction across the Irish Sea border and improve agribusiness trade with our largest market, our own country.

“The NIO and the Secretary of State seem fairly sanguine about the ‘Alliance Tax’. Yet the changes brought in by the wide-ranging Union Customs Code, including the new parcel handling fee, are now going ahead. HMRC has been very vague about how much the parcel tax will raise. It has reportedly said it will apply to only ‘about’ 1% of parcels, those deemed at risk. Even that small share is bringing in over £5 million. If the true figure is closer to 10%, that would be £50 million taken from the people of Northern Ireland for the so-called privilege of being in the Windsor Framework.

“Whitehall has largely ignored the implications of the Union Customs Code. It will bring considerable divergence from the rest of our nation, a substantial administrative burden and a massive increase in costs. If there is anything the Stormont Brake should be applied to, this is it.

“Finally, our government has agreed to apply parts of the EU AI Act in Northern Ireland. Either Whitehall is asleep, again, on EU regulation, or it is deliberately acquiescing in a digital border, to add to all the other internal UK borders it presides over. How any official cannot see the digital straitjacket the EU AI Act will place on Northern Ireland, and on the UK and global businesses that run much of their back-office work here, is beyond comprehension.

“Just what is our government willing to give up to achieve the Prime Minister’s ambition?”